Case Law Details
Bhagwan Keshu Sakhare Vs ITO (ITAT Pune)
The issue under consideration is whether CIT is correct in denial of exemption u/s 54B of the Act?
In the present case, the case of assessee is selected for limited scrutiny under CASS for the reason of “Deduction claimed under the head capital gains”. After claiming deduction for indexed cost of acquisition and transfer expenses, the assessee computed long term capital gain at Rs.80.84 lakhs. The assessee claimed exemption u/s.54B, inter alia, for a sum of Rs.45.00 lakhs towards a property. The assessment was completed allowing exemption u/s. 54B, inter alia, in respect of the above Rs.45.00 lakhs. Exercising power u/s.263 of the Act, the ld. CIT observed that as against exemption of Rs.45.00 lakhs, a sum of Rs. 35.00 lakhs was neither deposited in the Capital Gain Deposit Account scheme before the stipulated date nor another property was purchased before the prescribed date.
ITAT states that Section 54B of the Act categorically states that the amount of capital gain on transfer of land used for agricultural purposes should not be charged to tax if a new land is purchased within a period of three years or the amount is deposited in a designated capital gain account scheme. Since the assessee failed to satisfy none of these conditions, no exception can be taken to the view canvassed by the CIT in this regard. ITAT, therefore, uphold the impugned order.
In the result, the appeal filed by the assessee is dismissed.
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