Case Law Details
CA Sandeep Kanoi
A bare reading of section 54F clearly shows that the assessee is entitled for exemption in case he / she constructs a residential house within a period of three years after the sale of the capital asset. However, sub clause (4) of section 54F clearly says that the unutilized portion of the net sale consideration which is otherwise liable for capital gain tax shall be deposited in the capital gain account scheme within the period of due date for filing return of income u/s 139. The question arises for consideration is whether the due date mentioned in section 54F(4) is the due date for filing the return u/s 139(1) or the due date for filing the return of income u/s 139(4) of the Act.
We have carefully gone through the decision of this Tribunal in the case of Muthuyletchumi Janardanan (supra). This Tribunal, after referring to the judgment of the Punjab & Haryana High Court in the case of CIT vs Ms. Jagriti Aggarwal 339 ITR 610 (P&H) found that the assessee can deposit the amount within the time limit provided for filing the return u/s 139(4) of the Act. We find that the Apex Court had an occasion to interpret the provisions of Income-tax Act, more particularly, the term “due date” in Prakash Nath Khanna And Another vs CIT (2004) 266 ITR 1 (SC). The Apex Court found that due date means the due date for filing the return u/s 139(1) and not 139(4).
The Apex Court further found that had the intentions of the Legislature was to permit the assessee to file the return u/s 139(4) also, the use of the expression “section 139” alone would have been sufficed. The Legislature would not have said that it should be filed u/s 139(1).When the Legislature specifically refers to section 139(1), it cannot be the intention to permit the assessee to file the return u/s 139(4) also. The Supreme Court specifically observed that it cannot be said that the Legislature without any purpose or intent specified only the sub-sections (1) and (2) and the conspicuous omission of sub-section (4) has no meaning or purpose behind it. Sub-section (4) of section 139 cannot by any stretch of imagination control the operation of sub-section (1) wherein a fixed period for furnishing the return is stipulated.
This judgment of the Apex Court was not considered by the CIT(A). The assessee also had no occasion to bring this judgment to the notice of the CIT(A). When Legislature specifically refers only section 139(1) and omitted to refer section 139(4), this Tribunal is of the considered opinion that making a reference to section 139(4) cannot be proper. This judgment of the Apex Court in Prakash Nath Khanna And Another (supra) was also not brought to the notice of the bench of this Tribunal when the case of Muthuletchumi Janardanan (supra) was decided. Therefore, this Tribunal apparently followed the judgment of the Punjab & Haryana High Court in the case of Ms. Jagriti Aggarwal (supra). The judgment of the Kerala High Court in the case of V.R. Desai (supra) also was not considered by this Tribunal in the case of Muthuletchumi Janardanan (supra). Therefore, this Tribunal is of the considered opinion that the matter needs to be reconsidered by the assessing officer in the light of the judgment of the Apex Court in the case of Prakash Nath Khanna And Another (supra) and the judgment of the Kerala High Court in the case of V.R. Desai (supra). Accordingly, the orders of the lower authorities are set aside and the issue of exemption u/s 54(F) is restored to the file of the assessing officer. The assessing officer shall reconsider the issue afresh in the light of the judgment of the Apex Court in the case Prakash Nath Khanna And Another (supra) and the judgment of the Kerala High Court in V.R. Desai (supra) and thereafter decide the same in accordance with law after giving reasonable opportunity of hearing to the assessee.
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