Sri Arun Kumar BM v. ITO [ITA No. 667/Bang/2017,
dt. 3-11-2020] : 2020 TaxPub(DT) 4561 (Bang-Trib)
Insertion of second proviso to section 54EC(1) vide Finance
Act, 2014 with effect from assessment year 2015-16 capping total investment to
Rs. 50 lakhs is prospective
Facts:
Assessee had sold a plot on 20-3-2013 and then invested in
REC bonds for 1 crore in two lots - 50 lakhs on 31-3-2013 and subsequently 50
lakhs on 31-7-2013. It was the case of the assessing officer and Commissioner
(Appeals) who did not permit the second lot of investment under section 54EC
citing the same was not done before the end of the financial year and also
applied the amendments made in section 54EC(1) which capped the total
investment possible at Rs. 50 lakhs. On higher appeal by assessee --
Held in favour of the assessee that they were entitled to
deduction of the entire investment of 1 crore under section 54EC. Amendment
made in section 54EC vide Finance Act, 2014 is only prospective.
Relied on:
(i) Hon'ble Madras High Court in CIT v. C. Jaichander
(2015) 370 ITR 579 (Mad) : 2014 TaxPub(DT) 4189 (Mad-HC)
(ii) Shri Vivek Jairazbhoy v. DCIT (International
Taxation) (ITA No. 236/Bang/2012 - Order, dated 14-12-2012) : 2012 TaxPub(DT)
3445 (Bang-Trib)
(iii) DCIT v. Borkatte Ganapathi Hegde (ITA No.
964/Bang/2016) : 2017 TaxPub(DT) 4080 (Bang-Trib)