Nandkishore Ramanlal Parikh- HUF Vs ITO (ITAT Ahmedabad)
When the assessee had invested the entire sale consideration in construction of a residential house within the three years from the date of transfer. Could he be denied exemption under section 54F on the ground that he did not deposit the said amount in capital gain account scheme before the due date prescribed u/s. 139(1) of the Act.
In the case of Ashok Kapasiawala vs. ITO, 63 taxamnn.com 284 also the assessee did not deposit the sale consideration in the bank account before the due date of filing of return. But otherwise purchase of house is within two years stipulated in section 54F(1) of the Act. It is not the case of the assessee that she has purchased beyond the period as contemplated in section 54F(1). The only failure is, she has not deposited the sale consideration in capital account. This condition has not been considered as mandatory by the Hon’ble Karnataka High Court. So Where assessee did not deposit sale consideration in the bank account maintained under the capital gains scheme before the due date of filing of return but otherwise purchased new house within two years, as stipulated in section 54F(1), then deduction under section 54F could not be denied to assessee.
FULL TEXT OF THE ITAT JUDGEMENT
Assessee is in appeal before the Tribunal against order of the ld.CIT(A)-5, Ahmedabad dated 5.1.2017 passed for the Asstt.Year 2013- 14.
2. Assessee has taken four grounds of appeal, which are argumentative and descriptive in nature. At the time of hearing, the ld.counsel for the assessee has confined grievance of the assessee qua one issue viz. whether exemption under section 54F is available to the assessee or not on the investment of capital gain in purchase of a flat.
3. With the assistance of the ld.representatives, I have gone through the record carefully. It emerges out from the record that the assessee has filed her return of income electronically on 6.7.2013 declaring total income at Rs.278/-. Her case was selected for scrutiny assessment and
notice under section 143(2) of the Act was issued and served upon the assessee. Scrutiny of the accounts, it revealed to the AO that the assessee was having 1/8th share in a property at Patidar Society, C.G.Road, Ahmedabad. She has sold her 1/8th share on 25.2.2013 for a sum of Rs.90.00 lakhs. She invested Rs.80 lakhs on 3.7.2013 in Bank of Baroda under capital gain account scheme as per section 54F of the Act. Thereafter, she had purchased residential flat on 18.10.2014 for a sum of Rs.1,25,00,000/-. This purchase has been made within the prescribed time limit of two years as provided under section 54F(1) of the Act. She claimed that no capital gain tax is leviable upon the assessee. The ld.AO did not accept this contention of the assessee, and he allowed the deposits made in the capital account at Rs.80 lakhs. He made addition of Rs.8,01,740/-. Appeal to the CIT(A) did not bring any relief to the assessee.
4. The ld.counsel for the assessee compiled certain details in tabular form and it is imperative upon us to take note of these details for adjudication of this issue. It reads as under:
