Case Law Details
Ramalingam Nagarajan Vs ITO (ITAT Chennai)
ITAT Chennai held that exemption under section 54 of the Income Tax Act not allowable to the extent of non-deposit of unutilized amount in ‘Capital Gain Account Scheme’. Only proportionate exemption allowed.
Facts- The assessee has sold land & building for a sale consideration of Rs.1,51,00,000/-. The assessee has computed LTCG from the sale of land & building at Rs.89,99,443/- and claimed exemption u/s.54 of the Act, for purchase of residential house property for an amount of Rs.90 lakhs.
During the course of assessment proceedings, the AO noticed that the assessee has purchased new house property on 29.04.2015 for a consideration of Rs.45 lakhs and also entered into a construction agreement with M/s.Keshthana Infrastructure Pvt. Ltd., and paid advance of Rs.6 lakhs on 22.05.2017. Therefore, the AO opined that the assessee has not utilized full amount of capital gains derived from sale of original asset for acquiring new asset and thus, re-computed long term capital gains and also exemption u/s.54 of the Act, and allowed exemption u/s.54 of the Act, at Rs.48,59,420/- as against total exemption claimed by the assessee at Rs.90 lakhs.
Being aggrieved by the assessment order, the assessee preferred an appeal before the Ld.CIT(A) and the same was dismissed. Being aggrieved, the present appeal is filed.
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