Appeal details
Counselvise Citation
[2016] 131 COUNSELVISE.COM (IT) 6363 (ITAT-HYDERABAD)
Assessee PAN
Bench
Appeal Number
Duration Of Justice
1 year(s) 1 month(s) 6 day(s)
Appellant
Respondent
Appeal Type
Income Tax Appeal
Pronouncement Date
01-08-2016
Appeal Filed By
Department
Order Result
Dismissed
Bench Allotted
B
Next Hearing Date
01-08-2016
Assessment Year
2011-2012
Appeal Filed On
25-06-2015
Judgement Text
IN THE INCOME TAX APPELLATE TRIBUNAL HYDERABAD BENCHES B : HYDERABAD BEFORE SHRI D. MANMOHAN, VICE PRESIDENT AND SHRI B. RAMAKOTAIAH, ACCOUNTANT MEMBER ITA.NO.862/HYD/2015 ASSESSMENT YEAR 2011-2012 THE DCIT, CIRCLE 17(2) HYDERABAD. VS. MR. NIMMAGADDA PRASAD SECUNDERABAD. PAN ABKPN3078N (APPELLANT) (RESPONDENT) FOR REVENUE : MR. K.J. RAO FOR ASSESSEE : MR. K.A. SAIPRASAD DATE OF HEARING : 01.08.2016 DATE OF PRONOUNCEMENT : 01.08.2016 ORDER PER D. MANMOHAN, V.P. THIS APPEAL BY THE REVENUE IS DIRECTED AGAINST THE ORDER PASSED BY CIT(A)-5, HYDERABAD AND IT PERTAINS TO THE A.Y. 2011-2012. FOLLOWING GROUNDS WERE URGED BEFORE US. 2. WHETHER IN THE FACTS AND CIRCUMSTANCES OF THE CASE , THE LD. CIT(A) IS CORRECT IN DELETING THE DISALLOWANCE OF DEDUCTION UNDER SECTION 54F BY HOLDING THAT THE DEPOSITS IN CAPITAL GAINS ACCOUNT SCHEME NEED NOT B E OUT OF THE SALE PROCEEDS OF THE ASSET SOLD AND THE ASSESSEE IS ELIGIBLE FOR DEDUCTION IF OTHER CONDITI ONS ARE FULFILLED ? 3. WHETHER IN THE FACTS AND CIRCUMSTANCES OF THE CA SE, THE LD. CIT(A) IS CORRECT IN HOLDING THAT THE ASSESSEE IS ENTITLED FOR EXEMPTION CLAIMED UNDER SECTION 54F OF THE I.T. ACT WHEN THE AMOUNT OF NET CONSIDERATION WHICH IS NOT APPROPRIATED BY THE ASSESSEE TOWARDS PURCHASE O F NEW ASSET WAS NOT CREDITED TO THE CAPITAL GAINS ACC OUNT 2 ITA.NO.862/HYD/2015 MR. NIMMAGADDA PRASAD, SECUNDERABAD. SCHEME AS REQUIRED UNDER SUB-SECTION 4 OF SECTION 5 4F OF THE I.T. ACT BUT DEPOSITED AMOUNTS INCLUDE BORRO WED FUNDS ? 2. FACTS NECESSARY FOR THE DISPOSAL OF THE APPEAL ARE STATED IN BRIEF. THE ASSESSEE IN HIS INDIVIDUAL CAPAC ITY DERIVED INCOME FROM CAPITAL GAINS ON SALE OF PLOT LOCATED IN JUBILEE HILLS. THE SAID PLOT WAS SOLD FOR A CONSIDERATION OF RS.9,15 ,60,000. WITH AN INTENTION FOR PURCHASING ANOTHER PLOT THE SAID AMOUNT WAS DEPOSITED IN THE CAPITAL GAINS DEPOSIT SCHEME AND CLAIM ED EXEMPTION UNDER SECTION 54F OF THE ACT. 2.1. DURING THE COURSE OF ASSESSMENT PROCEEDINGS, THE ASSESSING OFFICER OBSERVED THAT THE ASSESSEE DEPOSITED ONLY A SUM OF RS.4,05,00,000 OUT OF THE SALE PROCEEDS AND THE B ALANCE AMOUNT WAS DEPOSITED IN THE CAPITAL GAINS ACCOUNT SCHEME BEING HIS OWN FUNDS. ACCORDING TO THE ASSESSING OFFICER, TH E DEPOSIT MADE OUT OF HIS OWN FUNDS IS NOT ELIGIBLE FOR EXEMPTIO N UNDER SECTION 54F OF THE ACT. HE ACCORDINGLY, COMPUTED THE TAXA BLE LONG TERM CAPITAL GAINS. 2.2. AGGRIEVED ASSESSEE CONTENDED BEFORE THE LD. CIT (A) THAT ASSESSEE HAD OBTAINED LOAN FROM SHRI N. PRAKASH ( INDIVIDUAL & HUF) AND DEPOSITED THE SAME IN THE CAPITAL GAINS ACCO UNTS SCHEME AND AS LONG AS THE MONEY IS DEPOSITED IN THE CA PITAL GAINS ACCOUNTS SCHEME THE ASSESSEE IS ENTITLED TO THE BENEFIT OF EXEMPTION AND IT IS NOT NECESSARY THAT THE CAPITAL GAINS D EPOSITED SHOULD FLOW FROM THE SALE PROCEEDS ONLY. IN THIS RE GARD, HE RELIED UPON THE DECISIONS OF ITAT HYDERABAD BENCH, MUMBAI BENCH AND DELHI BENCH REPORTED AS UNDER : 3 ITA.NO.862/HYD/2015 MR. NIMMAGADDA PRASAD, SECUNDERABAD. (I) SMT. PREMA P. SHAH VS. ITO 100 ITD 60 (MUM.) (II) SHRI J.V. KRISHNA RAO & SMT. J. SRI LAKSHMI, HYDERABAD VS. DCIT, CIRCLE-3(3), HYDERABAD 54 SOT 4 4 (ITAT-HYD BENCH). (III) BOMBAY HOUSING CORPORATION VS. ACIT (2002) 81 ITD 545 (ITAT-MUMBAI BENCH). (IV) MUNEER KHAN VS. ITO, WARD-7(2), HYDERABAD 41 SOT 504 (ITAT-HYD BENCH). (V) SITA JAIN & OTHERS VS. ACIT (2011) 39 (II) ITCL 499 (ITAT-DELHI BENCH). 2.3. THE LD. CIT(A) NOTICED THAT THE AFORECITED DECISI ONS SQUARELY APPLY TO THE FACTS OF THE INSTANT CASE AND BY RELYING UPON THE AFORECITED DECISIONS, HE ACCEPTED THE PLEA OF THE ASSESSEE. 3. AGGRIEVED, REVENUE IS IN APPEAL BEFORE US. AT TH E TIME OF HEARING, LEARNED COUNSEL, APPEARING ON BEHALF OF THE ASSESSEE, PLACED RELIANCE UPON THE DECISION OF THE HONBLE HIGH COURT IN THE CASE OF CIT VS. KAPIL KUMAR AGARWAL 66 TAXMAN.COM 1 91 (PUNJAB & HARYANA) WHEREIN AN IDENTICAL ISSUE WAS DECIDED. H E ALSO RELIED UPON A DECISION OF THE HONBLE KERALA HIGH COURT IN THE CASE OF ITO VS. K.C. GOPALAN 107 TAXMAN 591 WHEREIN THE COUR T OBSERVED THAT IT IS NOT NECESSARY THAT THE CONSIDERATION R ECEIVED ON SALE OF PROPERTY AS SUCH SHOULD BE UTILISED FOR CONSTRUCTION OF A NEW BUILDING AS LONG AS THE COST EQUIVALENT THERETO WAS UTILISED FOR CONSTRUCTION OF A NEW HOUSE. 4. ON THE OTHER HAND, LD. D.R. STRONGLY RELIED UPON THE ORDER PASSED BY THE ASSESSING OFFICER. 4 ITA.NO.862/HYD/2015 MR. NIMMAGADDA PRASAD, SECUNDERABAD. 5. WE HAVE CAREFULLY CONSIDERED THE RIVAL CONTENTIONS AND PERUSED THE RECORD. AS AGAINST THE DECISIONS OF HIGH COURT (SUPRA) AS WELL AS THE ITAT (SUPRA) NOT EVEN A SINGLE CONTRARY DECISION WAS PLACED BEFORE US BY THE REVENUE TO SUPPORT THE STAND TAKE N BY THE ASSESSING OFFICER. UNDER THESE CIRCUMSTANCES, WE UPHE LD THE VIEW TAKEN BY THE LD. CIT(A) AND DISMISS THE APPEAL FILED BY REVENUE. 6. AS PRONOUNCED IN THE OPEN COURT, THE APPEAL FILED BY THE REVENUE IS DISMISSED. SD/- SD/- (B. RAMAKOTAIAH) (D. MANMOHAN) ACCOUNTANT MEMBER VICE PRESIDENT HYDERABAD DATED 01 ST AUGUST, 2016 VBP/- COPY TO 1. THE DCIT, CIRCLE-17(2), 6 TH FLOOR, B BLOCK, I.T. TOWERS, A.C. GUARDS, HYDERABAD. 2. MR. NIMMAGADDA PRASAD, PLOT NO.D-19, FLAT NO.202, GAYATRI ARCADE, VIKRAMPURI COLONY, SECUNDERABAD. 3. CIT(A)-5, 6A, I.T. TOWERS, A.C. GUARDS, HYDERABAD. 4. CIT-5, HYDERABAD. 5. D.R. ITAT B BENCH, HYDERABAD. 6. GUARD FILE
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