INCOME TAX ACT, 1961

Section 54

Capital gains - Deduction under section 54 - Availability of benefit in respect of two flats which were situated in same residential building -

Assessee claimed deduction under section 54 as regards two flats which were situated in same residential building. AO held that deduction under section 54 could be allowed only in respect of one residential unit and thus AO allowed deduction in respect of one flat. Held: Expression 'a residential house' as appearing in section 54 cannot be interpreted in a manner to suggest that exemption would be restricted to a single residential unit. A residential house' as mentioned in section 54(1) has to be understood in a sense that building should be of a residential nature and the word 'a' should not be understood to indicate a singular number. Accordingly, AO was not correct in restricting exemption under section 54F to only one flat and assessee was entitled to exemption under section 54 in respect of both the flats.

Followed:CIT v. Gumanmal Jain (2017) 80 Taxman.com 21 (Mad-HC) : 2017 TaxPub(DT) 1680 (Mad-HC), CIT v. K.G. Rukminiamma (2011) 196 Taxman 87 (Karn-HC) : (2011) 131 ITR 211 (Karn-HC) : 2011 TaxPub(DT) 429 (Karn-HC), CIT v. V.R. Karpagam 50 taxman.com 55 [Mad-HC), ITO v. Sureddy Venkata Ramanamamma (2017) 83 Taxmann.com 99 (Visakha-Trib) : 2017 TaxPub(DT) 4159 (Visakha-Trib), CIT v. Gita Duggal (2013) 30 Taxmann.com 230 (Del-HC) : 2013 TaxPub(DT) 960 (Del-HC), CIT v. Syed Ali Adil (2013) 352 ITR 418 (AP) : (2013) 215 Taxman 283 (AP) : (2013) 33 Taxmaiin.com 212 (A P-HC) : 2013 TaxPub(DT) 1290 (AP-HC), Arun K. Thiagarajan v. CIT(A) (2020) 117 Taxmann.com 270 (Karn-HC) : 2020 TaxPub(DT) 2592 (Karn-HC) and CIT v. D Ananda Basppa 180 Taxman 4 (Karn-HC).

REFERRED :

FAVOUR : In assessee's favour.

A.Y. : 2013-14

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