SUBHASH KUMAR THARAYIL, MUMBAI V. ITO WD 31(3)(3), MUMBAI

ITA 921/MUM/2015

• Counselvise Citation: [2017] 128 COUNSELVISE.COM (IT) 8934 (ITAT-MUMBAI)
• Duration Of Justice: 1 year(s) 11 month(s) 2 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 12-01-2017
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: E
• Assessment Year: 2010-2011
• Appeal Filed On: 10-02-2015
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: BEENA SANTOSHDR
• Assessee Lawyers: USHA KADAM
• Keywords: Cost of acquisition
• Section: 54; 139

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL E BENCH, MUM BAI , BEFORE SHRI RAJENDRA, A.M. AND SHRI PAWAN SINGH,J.M . ./ITA NO.921/MUM/2015, / ASSESSMENT YEAR: 2010 11 MR. SUBHASH KUMAR THARAYIL A-703, ORION, VASANT GALAXY BANGUR NAGAR, GOREGAON (W) MUMBAI-400 090. PAN: ACYPT 0414 D VS. INCOME TAX OFFICER-WARD-24(3)(3) BANDRA KURLA COMPLEX MUMBAI. ( /APPELLANT ) ( / RESPONDENT ) REVENUE BY: M/S. BEENA SANTOSH-DR ASSESSEE BY: MS. USHA KADAM / DATE OF HEARING: 12.01.2017 / DATE OF PRONOUNCEMENT: 12.01.2017 ,1961 254(1) ORDER U/S.254(1)OF THE INCOME-TAX ACT,1961(ACT) , / PER RAJENDRA A.M. - CHALLENGING THE ORDER DATED 25.11.2014 OF CIT(A)-42 ,MUMBAI THE ASSESSEE HAS FILED THE PRESENT APPEAL.ASSESSEE,AN INDIVIDUAL FILED HIS RET URN OF INCOME ON 28/07/2010 DECLARING HIS TOTAL INCOME AT RS.2.97LAKHS.THE ASSESSING OFFICER( AO)COMPLETED THE ASSESSMENT U/S.143(3) OF THE ACT ON 26.3.13,DETERMINING HIS INCOME AT RS. 72.68 LAKHS. 2. EFFECTIVE GROUND OF APPEAL IS ABOUT DENYING THE DED UCTION U/S. 54 OF THE ACT.DURING THE ASSESSMENT PROCEEDINGS,THE AO FOUND THAT THE ASSESS EE HAD SOLD A RESIDENTIAL FLAT FOR A TOTAL CONSIDERATION OF RS.68 LAKHS, THAT AFTER REDUCING T HE INDEXED COST OF ACQUISITION OF RS.44.64 LAKHS HE ARRIVED AT A LONG TERM CAPITAL GAIN (LTCG) OF RS.23.35 LAKHS, THAT HE INVESTED THE LTCG BY BOOKING A FLAT IN GOREGAON FOR TOTAL CONSID ERATION OF RS.39.85 LAKHS,THAT HE PAID RS.22.76 LAKHS FROM MARCH 2010 TO JANUARY 2011,THAT REMAINING AMOUNT WAS PAID DURING THE PERIOD JUNE 2011 TO JUNE,2012.WHILE COMPLETING THE ASSESSMENT,THE AO DID NOT DISPUTE THE COMPUTATION OF LTCG OF RS.23.35 LAKHS AND ACCORDING LY CONSIDERED IT FOR DEDUCTION TO BE ALLOWED U/S. 54 OF THE ACT.HE OBSERVED THAT THE ASS ESSEE HAD INVESTED RS.10.91 LAKHS FOR PURCHASING THE NEW PROPERTY TILL THE NEW DATE OF FI LING OF RETURN OF INCOME BY 31.07.2010, THAT AS PER THE PROVISIONS OF SECTION 54 OF THE ACT HE W AS REQUIRED TO INVEST INTO THE RESIDENTIAL PROPERTY AND THE AMOUNT OF CAPITAL GAINS NOT SO INV ESTED WAS TO BE DEPOSITED INTO CAPITAL GAIN SAVINGS SCHEME BEFORE THE DUE DATE OF FILING OF RET URN OF INCOME/DATE OF RETURN FILED I.E. BY 28/7/2010, THAT HE HAD PURCHASED THE PROPERTY BUT H AD NOT UTILISED THE ENTIRE CAPITAL GAIN, THAT HE HAD INVESTED ONLY 10.91 LAKHS TILL THE FILING OF RETURN OF INCOME. ACCORDINGLY, RS.12.44 921/M/15-SUBHASH KT 2 LAKHS WAS CONSIDERED TO BE THE AMOUNT OF UNUTILISED CAPITAL GAINS. FINALLY, HE HELD THAT BENEFIT OF SECTION 54 OF THE ACT WAS NOT AVAILABLE TO THE A SSESSEE TO THAT EXTENT. 3. AGGRIEVED BY THE ORDER OF THE AO THE ASSESSEE PREF ERRED AN APPEAL BEFORE THE FIRST APPELLATE AUTHORITY (FAA),WHO UPHELD THE ORDER OF T HE AO. 4. DURING THE COURSE OF HEARING BEFORE US,THE AUTHORIZ ED REPRESENTATIVE (A.R.) OF THE ASSESSEE ARGUED THAT RS.12.44 LAKHS WERE DEPOSITED BEFORE TH E DUE DATE OF FILING OF RETURN OF INCOME AS ENVISAGED BY PROVISIONS OF SECTION 139(4) OF THE ACT,THAT SECTION 54 WAS A BENEFICIAL PROVI -SION.HE RELIED UPON HE CASES OF SMT. DEENAZ HOSHAN G JHABVALA (ITA/5062/MUM/2012 DT.15. 1.2014 FOR AY.2009-10),SAPNA DIMRI(19TAXMANN.COM15) ;JAGRITI AGGARWAL (15 TAXMANN. COM146);AND JAGANNATH SINGH LODHA(148TAXMANN1).THE DEPARTMENTAL REPRESENTATIVE (DR) LEFT THE ISSUE TO THE DISCRETION OF THE BENCH. 5. WE HAVE HEARD THE RIVAL SUBMISSIONS AND PERUSED THE MATERIAL BEFORE US. WE FIND THAT THE ISSUE STANDS COVERED BY THE ORDER OF THE HON'BLEBL E GAUHATI HIGH COURT DELIVERED IN THE CASE OF RAJESH KUMAR JALAN(286ITR274) AND THE CASES RELIED UPON BY THE AR. WE WOULD LIKE TO REPRODUCE THE RELEVANT PORTION OF THE ORDER FROM THE JUDGMENT OF HON'BLE GAUHATI HIGH COURT RAJESH KUMAR JALAN (SUPRA) AND IT READS AS U NDER :- .....FROM A READING OF SUB-SECTION (2) OF SECTION 5 4 OF THE ACT IT IS CLEAR THAT ONLY SECTION 139 HAS BEEN MENTIONED THEREIN, IN THE CONTEXT THAT THE UNU TILISED PORTION OF THE CAPITAL GAINS ON THE SALE OF PROPERTY USED FOR RESIDENCE SHOULD BE DEPOS ITED BEFORE THE DATE OF FURNISHING THE RETURN OF INCOME UNDER SECTION 139 OF THE INCOME-TAX ACT, 1961. SECTION 139 CANNOT MEAN ONLY SECTION 139(1) BUT IT MEANS ALL SUB-SECTIONS OF SECTION 139 . UNDER SUB-SECTION (4) OF SECTION 139 ANY PERSON WHO HAS NOT FURNISHED A RETURN WITHIN THE TI ME ALLOWED TO HIM UNDER SUB-SECTION (1) OF SECTION 142 MAY FURNISH THE RETURN FOR ANY PREVIOUS YEAR AT ANY TIME BEFORE THE EXPIRY OF ONE YEAR FROM THE END OF THE RELEVANT ASSESSMENT YEAR O R BEFORE THE COMPLETION OF THE ASSESSMENT WHICHEVER IS EARLIER. THE ASSESSEES CASE WAS THAT SINCE THE RETURN FOR THE ASSESSMENT YEAR 1996-97 COULD BE FURNISHED BEFORE THE EXPIRY OF ONE YEAR FROM THE END OF THE RELEVANT ASSESSMENT YEAR OR BEFORE THE COMPLETION OF THE ASS ESSMENT, WHICHEVER IS EARLIER, UNDER SUB- SECTION (4) , HE WAS ENTITLED TO FULFIL THE CONDITI ONS FOR EXEMPTION UNDER SECTION 54 UP TO MARCH 30, 1998. THE ASSESSEE WAS ENTITLED TO EXEMPTION UN DER SECTION 54 ON THE ENTIRE CAPITAL GAINS ON THE SALE OF HIS HOUSE PROPERTY. RESPECTFULLY FOLLOWING ABOVE JUDGMENT AND ORDERS RE LIED UPON BY AR,WE DECIDE EFFECTIVE GROUND OF THE ASSESSEE IN FAVOUR OF THE ASSESSEE. AS A RESULT, APPEAL FILED BY THE ASSESSEE STANDS A LLOWED. . ORDER PRONOUNCED IN THE OPEN COURT ON 12 TH ,JANUARY 2017. 12 , 2017 SD/- SD/- ( /PAWAN SINGH) ( / RAJENDRA) / JUDICIAL MEMBER / ACCOUNTANT MEMBER 921/M/15-SUBHASH KT 3 MUMBAI; .DATED : 12.01.2017. JV.SR.PS. / COPY OF THE ORDER FORWARDED TO : 1. APPELLANT / 2. RESPONDENT / 3. THE CONCERNED CIT(A)/ , 4. THE CONCERNED CIT / 5. DR E BENCH, ITAT, MUMBAI / , , . . . 6. GUARD FILE/ //TRUE COPY// / BY ORDER, / DY./ASST. REGISTRAR , /ITAT, MUMBAI.