Case Law Details
Y. Manjula Reddy Vs ITO (ITAT Bangalore)
The next impediment in the minds of the tax authorities was that the plot was purchased jointly in the name of the assessee and her husband and hence it should be held that both held 50% right each and hence the assessee could have purchased only her husband’s share only. We are unable to agree with this logic. There is no dispute that the assessee has actually given funds for the acquisition of the property. When the assessee’s husband has not given money for purchase of property, how it can be held that her husband was owner of 50% of the property merely for the reason that his name appears in the conveyance agreement and also in the rental agreement. The deduction under sec.54F of the Act shall be given only to the person who has invested the money. In the instant case, it is the assessee who has invested the money and hence the assessee should be given deduction u/s 54F of the Act for the money invested by her.
Additions, alterations, modifications and improvements on the new asset to make it habitable would be eligible for benefit of deduction u/s 54F
The Ld CIT(A) has taken the view that the amount spent after the date of registration of land, i.e., 24.02.2007 for interiors, renovation, furnishing etc cannot be part of acquisition. The Hon’ble Karnataka High Court has held in the case of Mrs. Rahana Siraj (2015)(58 com 333)(Kar) that the money spent in additions, alterations, modifications and improvements on the new asset to make it habitable would be eligible for benefit of deduction u/s 54F of the Act. Accordingly, we set aside the view so taken by Ld CIT(A) as it is contradictory to the binding decision of jurisdictional High Court. Accordingly, we hold that the assessee is eligible for deduction u/s 54F of the Act in the amount spent on interiors, renovation, furnishing etc.
FULL TEXT OF THE ORDER OF ITAT BANGALORE
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