Section 54 Exemption Allowed – Possession Date of Under-Construction Flat Relevant, Not Agreement Date – ITAT Mumbai

Prakash Devidas Vs ACIT (ITAT Mumbai)

Assessee claimed exemption u/s 54 on LTCG of ₹62.31 lakh arising from sale of residential flat, which was denied by AO/NFAC on ground that new flat was “purchased” before prescribed period since agreement for under-construction property was executed in May 2012. Assessee contended that payments were construction-linked and possession of fully constructed flat was received on 07-01-2015, i.e., within two years from date of sale (28-10-2013).

ITAT observed that agreement dated 23-05-2012 related to an under-construction property wher

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