Smt. Saroj Aggarwal, Kolkata V. I.T.O Wd - 29(4),kolkata, Kolkata

ITA 885/KOL/2013

• Counselvise Citation: [2016] 121 COUNSELVISE.COM (IT) 3394 (ITAT-KOLKATA)
• Duration Of Justice: 2 year(s) 8 month(s) 28 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 20-01-2016
• Appeal Filed By: Assessee
• Bench Allotted: B
• Assessment Year: 2007-2008
• Appeal Filed On: 22-04-2013
• Court: TRIBUNAL
• Department Lawyers: MD GHAYAS UDDIN
• Assessee Lawyers: S JHAJHARIA
• Section: 143(3); 54F; 54; 139

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL B BENCH: KOL KATA [BEFORE SHRI MAHAVIR SINGH, JM & SHRI WASEEM AHMED , AM] I.T.A NO.885/KOL/2013 ASSESSMENT YEAR: 2007-08 SMT. SAROJ AGGARWAL VS. INCOME-TAX OFFICER, (PAN: ACZPA7489A) WD-29(4), KOLKATA ( APPELLANT ) ( RESPONDENT ) DATE OF HEARING: 11.12.2015 DATE OF PRONOUNCEMENT: 20.01.2016 FOR THE APPELLANT: SHRI, S. JHAJHARIA, FCA FOR THE RESPONDENT: MD. GHAYAS UDDIN, JCIT, SR. DR ORDER PER SHRI MAHAVIR SINGH, JM: THIS APPEAL BY ASSESSEE IS ARISING OUT OF ORDER OF CIT(A)-XVI, KOLKATA VIDE APPEAL NO. 36/CIT(A)-XVI/29(4)/KOL/09-10 DATED 04.0 2.2013. ASSESSMENT WAS FRAMED BY ITO, WARD-29(4), KOLKATA U/S. 143(3) OF THE INCO ME-TAX ACT, 1961 (HEREINAFTER REFERRED TO AS THE ACT) FOR ASSESSMENT YEAR 2007- 08 VIDE HIS ORDER DATED 02.12.2009. 2. THE ONLY ISSUE IN THIS APPEAL OF ASSESSEE IS AGA INST THE ORDER OF CIT(A), CONFIRMING THE ACTION OF AO IN DENYING DEDUCTION U/ S. 54F OF THE ACT, ON THE ENTIRE AMOUNT OF CAPITAL GAINS ARISING OUT OF SALE OF RESI DENTIAL HOUSE PROPERTY INVESTED IN ACQUIRING A NEW RESIDENTIAL FLAT BEFORE THE DUE DAT E OF FILING OF RETURN U/S. 139(4) OF THE ACT. 3. BRIEFLY STATED FACTS ARE THAT THE ASSESSEE SOLD A RESIDENTIAL HOUSE PROPERTY DURING THE FY 2006-07 FOR A SUM OF RS.50 LACS AND PURCHASE D AN UNDER-CONSTRUCTION FLAT IN UNITECH, RAJARHART, KOLKATA BY PAYING BOOKING AMOUN T OF RS.4,19,072/- AS APPLICATION MONEY ON 19.08.2006. DURING THE RELEVANT FY 2006-0 7, THE ASSESSEE HAS INVESTED A SUM OF RS.14,66,751/- IN TOTAL AMOUNT UP TO 31.03.2007. A FURTHER SUM OF RS. 4,69,072/- WAS INVESTED BEFORE THE DUE DATE OF FILING OF RETURN U/ S. 139(1) OF THE ACT I.E. ON OR BEFORE 31.07.2007. THIS MEANS THE ASSESSEE INVESTED A SUM OF RS. 19,35,824/- UP TO 31.07.2007. THE LONG TERM CAPITAL GAIN IN THE SALE OF HOUSE PROPERTY WAS TO THE EXTENT OF RS.34,94,896/- BUT HE CLAIMED DEDUCTION U/S. 54F OF THE ACT FOR THE INVESTMENT AS HE HAS INVESTED IN THIS RESIDENTIAL FLAT THE AMOUNT OF RS.38,70,276/- UP TO 31.03.2009 I.E. THE DATE OF FILING OF RETURN U/S. 139(4) OF THE ACT . THE AO DISALLOWED THE CLAIM OF 2 ITA NO.885/K/2013 SMT. SAROJ AGGARWAL AY 2007-08 DEDUCTION U/S 54F OF THE ACT ON RS. 15,59,072/- BEI NG NOT INVESTED WITHIN THE DUE DATE OF FILING OF RETURN OF INCOME U/S 139(1) OF THE ACT I.E. BY 31.07.2007. ACCORDING TO AO AND CIT(A) THE ASSESSEE IS ELIGIBLE FOR DEDUCTION U /S 54F OF THE ACT FOR THE SUM OF RS. 19,35,824/- ONLY FOR THE REASON THAT THIS AMOUNT IS INVESTED IN PURCHASE OF RESIDENTIAL HOUSE PROPERTY AND THE BALANCE AMOUNT OF CAPITAL GA INS ARISING OUT OF SALE OF RESIDENTIAL HOUSE PROPERTY TO THE EXTENT OF RS. 15,59,072/- HAS NOT BEEN INVESTED ON OR BEFORE THE DUE DATE OF FILING OF RETURN OF INCOME U/S 139(1) O F THE ACT. AGGRIEVED, ASSESSEE CAME IN SECOND APPEAL BEFORE TRIBUNAL. 4. WE HAVE HEARD RIVAL CONTENTIONS AND GONE THROUGH FACTS AND CIRCUMSTANCES OF THE CASE. THE ADMITTED FACTS ARE THAT THE ASSESSEE SOLD A RESIDENTIAL HOUSE PROPERTY DURING THE FY 2006-07 FOR A SUM OF RS.50 LACS AND PURCHASED AN UNDER-CONSTRUCTION RESIDENTIAL FLAT IN UNITECH, RAJARHART, KOLKATA BY PAYING BOOKING AM OUNT OF RS.4,19,072/- AS APPLICATION MONEY ON 19.08.2006. THE ASSESSEE EARNE D LONG TERM CAPITAL GAINS ON THIS TRANSACTION AT RS. 34,94,896/-. THE ASSESSEE INVEST ED A SUM OF RS. 19,35,824/- IN PURCHASE OF AN UNDER-CONSTRUCTION RESIDENTIAL FLAT UP TO 31.07.2007 I.E. THE DUE DATE OF FILING OF RETURN OF INCOME BY THIS ASSESSEE. THE AS SESSEE ALSO INVESTED TOTAL SUM OF RS. 38,70,276/- IN PURCHASE OF AN UNDER-CONSTRUCTION RE SIDENTIAL FLAT UP TO 31.03.2009 I.E. THE DATE OF FILING OF RETURN OF INCOME BY THIS ASSESSEE U/S 139(4) OF THE ACT. THAT MEANS THE ASSESSEE HAS INVESTED THE ENTIRE LONG TERM CAPITAL GAIN OF RS.34,94,896/- ONLY UP TO 31.03.2009 I.E. THE DUE DATE OF FILING OF RETURN OF INCOME BY THE ASSESSEE U/S. 139(4) OF THE ACT AND NOT U/S. 139(1) OF THE ACT. ON THIS, L D. COUNSEL FOR THE ASSESSEE RELIED ON THE DECISION OF HONBLE KARNATAKA HIGH COURT IN THE CASE OF FATIMA BAI VS. ITO (2009) 32 DTR 243 WHEREIN IT IS HELD AS UNDER: '11. THE EXTENDED DUE DATE UNDER SECTION 139(4) WOULD BE 31.3.1990. THE ASSESSEE DID NOT FILE THE RETURN WITHIN THE EXTENDED DUE DAT E, BUT FILED THE RETURN ON 27.2.2000. HOWEVER, THE ASSESSEE HAD UTILIZED THE E NTIRE CAPITAL GAINS BY PURCHASE OF A HOUSE PROPERTY WITHIN THE STIPULATED PERIOD OF SECTION 54(2) I.E., BEFORE THE EXTENDED DUE DATE FOR RETURN UNDER SECTION 139 . THE ASSESSEE TECHNICALLY MAY HAVE DEFAULTED IN NOT FILING THE RE TURN UNDER SECTION 139(4) . BUT, HOWEVER, UTILIZED THE CAPITAL GAINS FOR PURCHASE OF PROPERTY BEFORE THE EXTENDED DUE DATE UNDER SECTION 139(4) . THE CONTENTION OF THE REVENUE THAT THE DEPOSIT IN THE SCHEME SHOULD HAVE BEEN MADE BEFORE THE INITIAL DUE DATE AND NOT THE EXTENDED DUE DATE IS AN UNTENABLE CONTENTION.' HONBLE KARNATAKA HIGH COURT FINALLY CONCLUDED THAT ASSESSEE HAVING UTILIZED THE ENTIRE CAPITAL GAINS BY PURCHASING A HOUSE PROPERTY BEFORE THE EXTENDED DUE DATE U/S. 139(4) OF THE ACT, THE ASSESSEE IS ELIGIBLE FOR EXEMPTION U/S . 54 OF THE ACT. SIMILAR ARE THE FACTS IN 3 ITA NO.885/K/2013 SMT. SAROJ AGGARWAL AY 2007-08 THE PRESENT CASE BEFORE US, AND IN THE GIVEN PROPOS ITION OF LAW BY HONBLE KARNATAKA HIGH COURT IN FATIMA BAI, SUPRA, WE ALLOW THE CLAIM OF ASSESSEE. THE AO IS DIRECTED ACCORDINGLY. 5. IN THE RESULT, APPEAL OF ASSESSEE IS ALLOWED. 6. ORDER IS PRONOUNCED IN THE OPEN COURT ON 20.01.2 016. SD/- SD/- (WASEEM AHMED) (MAHAVIR SINGH) ACCOUNTANT MEMBER JUDICIAL MEMBER DATED :20 TH JANUARY, 2016 JD.(SR.P.S.) COPY OF THE ORDER FORWARDED TO: 1. APPELLANT SMT. SAROJ AGGARWAL, C/O SALARPURIA JAJODIA & CO. 7, C. R. AVENUE, KOLKATA-700 072. 2 RESPONDENT ITO, WARD-29(4), KOLKATA. 3. THE CIT(A), KOLKATA 4. 5. CIT , KOLKATA DR, KOLKATA BENCHES, KOLKATA / TRUE COPY, BY ORDER, ASSTT. REGISTRAR .