Case Law Details
Ramdas Pandharinath Kale (HUF) Vs ITO (ITAT Pune)
Assessee claimed deduction of Rs.80,85,572/- on account of re-investment in agricultural land. The AO allowed the same. The assessee filed additional evidences on other issue by way of a registered agreement dated 08-07-2016 on account of purchase of new house property in support of claim u/s. 54F of the Act. The CIT(A) having found the said information not before the AO, sought remand report. The AO furnished remand report. According to the AO relating to this issue u/s. 54B of the Act held that the assessee purchased agricultural land to an extent of Rs.72,21,240/- on individual capacity and Rs.8,64,335/- in HUF capacity. By holding so, the AO submitted remand report to the CIT(A) seeking enhancement of income. The CIT(A) discussed the said issue from paras 12 to 12.2 of the impugned order, wherein, the disallowance made Rs.72,21,240/- on account of having purchased agricultural land in individual capacity and allowed to an extent of Rs.8,64,335/-. Thereby, the CIT(A) enhanced the total income of the assessee to an extent of Rs.72,21,240/-.
AR argued that the Surat Bench of Tribunal by placing reliance on the decision of Hon’ble High Court of Rajasthan in the case of Laxmi Narayan reported in 402 ITR 117 (Raj.) held that where assessee had purchased new agricultural land out of sale consideration of his agricultural land, assessee could not be denied deduction u/s. 54B of the Act merely because registered document of new land was executed in name of his wife. On perusal of para 12 of the said order of Surat Bench of Tribunal which held the HUF is owner of the said agricultural land though it is registered in the name of the coparcener, as the HUF is enjoying all the benefits of the said agricultural land. Admittedly, in the present case, the assessee being an HUF purchased agricultural land to an extent of Rs.72,21,240/- in individual capacity. The copy of said purchase deeds of agricultural land are furnished from pages 16 to 53 of the paper book. Further, I find the Hon’ble High Court of Delhi in the case of Ravinder Kumar Arora reported in 342 ITR 38 held that the provisions of section 54 of the Act are the beneficial provision which should be interpreted liberally in favour of the deduction to the taxpayer and deduction should not be denied on hyper technical ground. There is no dispute with regard to reinvestment on agricultural land by the assessee in his individual capacity, the provisions u/s. 54 of the Act being the beneficial provision which should be interpreted liberally in favour of the assessee seeking deduction u/s. 54B of the Act. Therefore, following the order of Surat Bench of Tribunal in the case of Babubhai Arjanbhai Kanani (HUF) (supra), I hold that the assessee is entitled to claim deduction u/s. 54B of the Act and enhancement made by the CIT(A) is not justified.
FULL TEXT OF THE ORDER OF ITAT PUNE
This appeal by the assessee against the order dated 17-12-2018 passed by the Commissioner of Income Tax (Appeals)-5, Pune [‘CIT(A)’] for assessment year 2013-14.
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