Case Law Details
PCIT Vs Akshay Sobti (Delhi High Court)
High Court states that, it is an accepted position and is not disputed by the Revenue that the assessee had sold the property at Jor Bagh on 21.12.2011. On the said sale, the assessee has claimed deduction of capital gains under Section 54 of the The assessee was required to purchase a residential house property either one year before, or within two years after the date of transfer of original asset; or within a period of three years after the date he was required to construct a residential house. CBDT in its circulars No. 672 dated 16.12.1993 has made it clear that the earlier circular No. 471 dated 15.10.1986 in which it was stated that acquisition of flat through allotment by DDA has to be treated as a construction of flat, would apply to cooperative societies and other institutions. The tax authorities have relied upon the said circular and held that the builder would fall in the category of other institutions and, therefore, booking of the flat with the builder has to be treated as construction of flat by the assessee. In accordance with the said agreement, the assessee was to make payment in installments and the builder was to construct an unfinished bare shell flat for finishing by the buyers. The possession was granted on 30.03.2013. The lower tax authorities after examining the terms of the agreement, the occupation certificate, and the other letters-offer to finalize the details of interiors, have come to a conclusion that the assessee had booked a semi furnished flat with the builder, namely, DLF Universal Ltd. in the residential group housing complex named as Magnolias DLF Golf Links. Accordingly, the assessee had a window of three years period from 21.12.2011 till 21.12.2014 to construct a house property, calculated from the date of transfer of original asset. The appellant has claimed deduction on amount invested till the due date of filing of return under Section 139 (1) of the Income Tax Act. In this factual background, High Court do not find any cogent ground to hold that the Respondents do not fulfill the conditions laid down under Section 54 (1) of the Act so as to deny the benefit of the said provision. The apprehension expressed by the learned senior standing counsel for the Revenue is not borne from the facts on record. The provision in question is a beneficial provision for assessees, who replace the original long term capital asset by a new one.
In view of the aforesaid decision, HC are of the opinion that the question urged by the Revenue does not require our consideration.
FULL TEXT OF THE HIGH COURT ORDER /JUDGEMENT
Caveat No. 1219/2019 in ITA 992/2019
Please become a Premium member. If you are already a Premium member, login here to access the full content.
It possible to purchase a site and construct the residential house under 54f of it act. If yes what is the time limite?