Case Law Details
Sakharam Bhondve Vs ITO (ITAT Pune)
The issue under consideration is whether the deduction u/s 54F for reinvestment against Capital gain in the name of wife and son will be allowed or not?
As per the judgement of the Hon’ble Bombay High Court in the case of Kamal Wahal (supra):
“It also noted that a purposive construction is to be preferred as against a literal construction, more so when even applying the literal construction, there is nothing in the section to show that the house should be purchased in the name of the assessee only. As a matter of fact, Section 54F in terms does not require that the new residential property shall be purchased in the name of the assessee; it merely says that the assessee should have purchased/constructed “a residential house”.
“It is moreover to be noted that the assessee in the present case has not purchased the new house in the name of a stranger or somebody who is unconnected with him. He has purchased it only in the name of his wife. There is also no dispute that the entire investment has come out of the sale proceeds and that there was no contribution from the assessee’s wife.”
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