The Tax Publishers2019 TaxPub(DT) 8376 (Del-Trib)

INCOME TAX ACT, 1961

Section 54F

For the purpose of claiming exemption under section 54F(1)(b), adoption of sale consideration by invoking section 50C, instead of taking actual sale consideration received by the assessee was not in accordance with the provision of section 50C which has created a deeming fiction. Further, section 54F is an exemption provision and it has given its applicability in itself, therefore, section 50C will not come into picture. Thus, assessee had rightly taken actual sale consideration, while claiming exemption under section 54F.

Capital gains - Exemption under section 54F - Whether sale consideration be adopted by invoking section 50C -

Assessee claimed exemption under section 54F by showing purchase of residential property. AO admitted the claim of assessee for exemption under section 54F(1)(b) in respect of investment of long term capital gain but instead of taking actual sale consideration received, had adopted the figure of sale consideration by invoking section 50C. Accordingly, AO made addition. Assessee contended that section 50C will be applicable to determine sale consideration for the purpose of computation of capital gain and not for purpose of computing exemption. Held: For the purpose of claiming exemption under section 54F(1)(b), adoption of sale consideration by invoking section 50C instead of taking actual sale consideration received by the assessee was not in accordance with the provision of section 50C which has created a deeming fiction. Further, section 54F is an exemption provision and it has given its applicability in itself, therefore, section 50C will not come into picture. Thus, adoption of actual sale consideration received by the assessee while claiming exemption under section 54F was in consonance with section 54F. Besides that, Revenue had not given any reasons as to why the enhancement of sale consideration by adopting stamp duty value was necessary. Thus, the addition made by Revenue was deleted.

REFERRED : CIT v. V.S. Dempo Company Ltd. (2016) 387 ITR 354 (SC) : 2016 TaxPub(DT) 4318 (SC), CIT & Anr. v. George Henderson & Co. Ltd. (1967) 66 ITR 622 (SC) : 1967 TaxPub(DT) 0360 (SC), Gouli Mahadevappa v. ITO (2013) 259 CTR 579 (Karn) : 2013 TaxPub(DT) 1581 (Karn-HC), CIT v. Nilofer I. Singh (2008) 309 ITR 233 (Delhi HC) : 2009 TaxPub(DT) 0785 (Del-HC), CIT v. Ace Builders (P.) Ltd. (2005) 281 ITR 210 (Bom-HC) : 2006 TaxPub(DT) 0283 (Bom-HC), CIT v. Assam Petroleum Industries (P.) Ltd. (2003) 262 ITR 587 (Gau-HC) : 2003 TaxPub(DT) 1326 (Gau-HC), Sabita Devi Agarwal v. ITO (2019) 69 ITR(T) 231 (Kolkata-Trib.) : 2019 TaxPub(DT) 0480 (Kol-Trib), Anant Chetan Agarwal v. DCIT (2018) 172 ITD 525 (Lucknow-Trib.) : 2018 TaxPub(DT) 6570 (Luck-Trib), ITO v. Raj Kumar Parashar (2017) 167 ITD 237 (Jaipur-Trib.) : 2017 TaxPub(DT) 4382 (Jp-Trib), DCIT v. Dr. Chalasani Mallikarjuna Rao (2016) 161 ITD 721 (Visakhapatnam Trib.) : 2016 TaxPub(DT) 4675 (Visakhapatnam-Trib), Nand Lal Sharma v. ITO (2015) 40 ITR(T) 518 (Jaipur-Trib.) : 2015 TaxPub(DT) 2640 (Jp-Trib)m, Dhanveer Singh Gambhir v. ITO (2015) 56 taxmann.com 205 (Indore-Trib.) : 2015 TaxPub(DT) 1963 (Ind-Trib), Raj Babbar v. ITO (2013) 29 taxmann.com 11 (Mumbai-Trib.) : 2013 TaxPub(DT) 1132 (Mum-Trib), Prakash Karnawat v. ITO (2011) 16 taxmann.com 357 (Jaipur) : 2012 TaxPub(DT) 0021 (Jp-Trib), Gyan Chand Batra v. ITO (2010) 6 ITR(T) 147 (Jaipur) : 2010 TaxPub(DT) 2185 (Jp-Trib), ITO v. Manjit Singh (2010) 128 TTJ 82 (Chandigarh) (UO) : 2010 TaxPub(DT) 1295 (Chd-Trib)

FAVOUR : In assessee's favour

A.Y. : 2009-10

IN THE ITAT, DELHI BENCH

SUBSCRIBE TaxPublishers.inSUBSCRIBE FOR FULL CONTENT