ACIT Vs Siva Jyothi Palam (ITAT Visakhapatnam)
ITAT Visakhapatnam held that denial of deduction under section 54F of the Income Tax Act merely because date of registration was beyond the stipulated period as entire consideration paid within the stipulated period.
Facts- The case of the assessee was selected for scrutiny under CASS. During the assessment proceedings, AO noticed that the assessee sold vacant land at Gollapudi, Vijayawada for a consideration of Rs. 5,40,31,000/-. Further, the assessee has also purchased a house property at Chennai for a consideration of Rs. 6,06,10,000/- and claimed deduction U/s. 54F of the Act. AO completed the assessment U/s. 143(3) of the Act and disallowed the assessee’s claim of exemption U/s. 54F of the Act by holding that the impugned property was purchased by the assessee only on 17/12/2019, which is beyond the stipulated period of 24 months from the date of sale of the land. Accordingly, AO determined the assessed income of the assessee at Rs. 3,55,55,297/-.
CIT(A) allowed the appeal. Being aggrieved, revenue has preferred the present appeal.
Conclusion- Hon’ble Karnataka High Court in the case of CIT vs. Sambandam Udaykumar is concerned has held that “the condition precedent for claiming benefit under the said provision is the capital gain realized from the sale of capital asset should have been parted by the assessee and invested either in purchasing a residential house or in constructing a residential house. If after making the entire payment, merely because a registered sale deed had not been executed and registered in favour of the assessee before the period stipulated it cannot be denied the benefit of section 54F of the Act”.
