Case Law Details
Shri Shailesh Kumar Chaturvedi Vs ITO (ITAT Jaipur)
The issue under consideration is whether the expense on electricity and water bill will convert the status of plot of land into residential property and accordingly assessee will be eligible for deduction u/s 54?
In the present case, AO in the assessment order held that the assessee had only sold plot of land and no residential house construction was there on the said land and hence he disallowed the claim about cost of construction as well as the deduction claimed u/s 54 of the Income Tax Act, 1961. But the assessee states that a house was constructed over the land sold by him having electricity and water connections. It was therefore requested that the claim of the assessee may kindly be allowed and the action of the ld. AO may kindly be quashed.
ITAT states that there is nothing on record in terms of buyers confirmation/affidavit or photographs of the property at the time of sale which can corroborate that what has been purchased/sold is not just a plot of land but a plot of land along with constructed house thereon which could then have been verified by the Assessing officer. The affidavit of the tenant in terms of past tenancy and past electricity and water bills cannot come to the aid of the assessee to demonstrate the existence of the constructed house at the time of sale. ITAT thus find that the assessee has failed to discharge the necessary onus placed on him in support of his claim and cost of construction as so claimed remain unsubstantiated and cannot be allowed. At the same time, where the AO is ceased of the information that the assessee has made fresh investment in certain house property and plots of land and is also accepting that such investment may be eligible for claim under section 54F, it is incumbent on the part of the Assessing officer that in such a situation, where he had denied the assessee’s claim under section 54, he should have allowed appropriate claim to the assessee under section 54F as per law. Since we have already quashed the notice u/s 148, no useful purpose would be served in setting aside the matter to the AO to allow the deduction under section 54F as the consequent proceedings stand quashed. The appeal is disposed off accordingly.
FULL TEXT OF THE ITAT JUDGEMENT
Please become a Premium member. If you are already a Premium member, login here to access the full content.
