Case Law Details
Kiranbhai Jamnadas Sheth (HUF) Vs ACIT (ITAT Rajkot)
Conclusion: Assessee was not entitled to capital gain exemption under section 54 for purchase of houseboat as the same could not be equated with the residential house which was immovable property.
Held: In the present case, AO disallowed capital gain exemption under section 54 on assessee’s investment towards the purchase of houseboat as houseboat was not a residential property within the meaning of section 54. It was noticed that assessee had not produced the registered sale deed for purchase of houseboat, therefore it could not be said that assessee had purchased a residential house. Further, there was a ban in the purchase of immovable property as well as a boat by the non-state subject of the J & K State. Therefore, assessee was not legally entitled to purchase houseboat, which was movable property but held to be land by J & K Land Revenue Act, 1939. Hence, the same could not be equated with the residential house which was immovable property. Therefore, capital gain exemption was rightly denied by AO.
FULL TEXT OF THE ITAT JUDGEMENT
1. These cross appeals filed by the Assessee and Revenue are directed against the order of learned Commissioner of Income Tax (Appeals)-IV, Rajkot(in short “the CIT (A)”) dated 28.03.2007 pertaining to Assessment Year 1999-2000 which in turn has arisen from the order passed by the ACIT, Junagadh Circle-1, Junagadh(in short “the AO”) dated 27.03.2006 under section 143(3) r.w.s. 147 of Income Tax Act,1961 (in short ‘the Act’).
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