Case Law Details
Salma Ahmed Vs ITO (ITAT Chennai)
Introduction: A recent appeal case from Salma Ahmed against ITO has shed light on the importance of furnishing complete details when claiming capital gain deductions under section 54F of the Income Tax Act. The ITAT Chennai has emphasized the rights of the assessee and the principles of natural justice.
Details on the Original Order: Salma Ahmed made a late return filing for the assessment year 2016-17 on 31.03.2018, proclaiming a total income of ₹.71,09,420/- after claiming a substantial deduction under section 54F. The return was selected to examine the exemption claimed under this section, resulting in a revised assessment of her total income at ₹.2,39,48,340/-.
Denial of Exemption by Assessing Officer: The primary contention arose when the Assessing Officer recalculated the capital gains, denying Ahmed’s claim of exemption under section 54F to the tune of ₹.1,25,00,000/-. In addition, certain amounts were reassessed pertaining to undisclosed income and cost of improvement claims.
Assessee’s Appeal & Tribunal’s Verdict: After the dismissal of Ahmed’s appeal by CIT(A), the case moved to the Tribunal. The defense contended that as long as deposits related to capital gains are made on or before the due date of income return filing, the exemption should stand. Ahmed’s inability to respond adequately to notices, especially during the challenging times of the Covid-19 pandemic, further highlighted the need for a reconsideration of her case.
Please become a Premium member. If you are already a Premium member, login here to access the full content.
