Case Law Details
Ramasubramaniam Sridhar Paul Vs ITO (ITAT Chennai)
The case of Ramasubramaniam Sridhar Paul Vs ITO before the Income Tax Appellate Tribunal (ITAT) Chennai revolves around the interpretation of Sec.54F of the Income Tax Act. The appeal pertains to the denial of exemption claimed under Sec.54F for non-utilization of funds deposited in the Capital Gain Account Scheme towards new investments within the stipulated period.
The appellant contested the disallowance of exemption claimed under Sec.54F by the Commissioner of Income Tax (Appeals), arguing that the Act does not mandate that the specific sum deposited in the capital gains account scheme must be utilized for new investments. Instead, the appellant highlighted that Sec.54F only requires the purchase or construction of a residential property within the stipulated time period, without specifying the funding source.
The appellant presented evidence regarding the purchase of a plot at VGP Selvanagar and the construction agreement for residential flats at Urbanville, Velachery Main Road. However, the authorities concluded that the investments were not made within the prescribed time frame, leading to the denial of the claimed deduction.
During the appellate proceedings, the appellant provided details of the construction agreement and payments made towards construction, demonstrating compliance with the statutory requirements. Despite the appellant’s arguments, the Commissioner upheld the denial of deduction, citing non-utilization of funds deposited in the capital gains account scheme for new investments.
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