The Tax Publishers2020 TaxPub(DT) 3131 (Ranchi-Trib)

INCOME TAX ACT, 1961

Section 54F

CIT(A)'s detailed discussion in view of Prakash (by legal heir of assessee) v. ITO & & Ors. (2008) 312 ITR 40 (Bom) : 2009 TaxPub(DT) 0850 (Bom-HC) that assessee's deduction claim was rightly disallowed, however, in case of CIT v. Kamal Wahal (2013) 258 CTR 251 (Del) : 2013 TaxPub(DT) 1087 (Del-HC) deciding the issue in assessee's favour in ITA No. 4/ 2013 dt. 11-1-2013, faced with this situation of non-jurisdictional high courts having different opinions on the issue, invoking Apex Court judgment in CIT v. Vegetable Products Ltd. (1973) 88 ITR 192 (SC) : 1973 TaxPub(DT) 0421 (SC) that the view in assessee's favour had to be adopted, therefore, AO was directed to delete the disallowance.

Capital Gains - Exemption under section 54F - Disallowing exemption claim for the sole reason that assessee had not reinvested long term capital gains in his own name but in name of his wife -

The assessee's sole substantive grievance was to reverse both the lower authorities action disallowing section 54F deduction claim. It was not in dispute that assessee had invested the corresponding long term capital gain in the name of his wife. CIT(A) had upheld the order of AO disallowing the deduction claim for the sole reason that assessee had not reinvested the long term capital gains in his own name but in the name of his wife. Held: Drawing strength from CIT(A)'s detailed discussion in view of Prakash (by legal heir of assessee) v. ITO & & Ors. (2008) 312 ITR 40 (Bom) : 2009 TaxPub(DT) 0850 (Bom-HC) that assessee's deduction claim was rightly disallowed. In case of CIT v. Kamal Wahal (2013) 258 CTR 251 (Del) : 2013 TaxPub(DT) 1087 (Del-HC) deciding the issue in assessee's favour in ITA No. 4/ 2013 dt. 11-1-2013. Faced with this situation of non-jurisdictional high courts having different opinions on the issue and no guidance coming from High Court, it was invoked Apex Court judgment in CIT v. Vegetable Products Ltd. (1973) 88 ITR 192 (SC) : 1973 TaxPub(DT) 0421 (SC) that the view in assessee's favour had to be adopted. Thus, AO was directed to delete the disallowance.

Provisions explained:Mysore Minerals Ltd. v. CIT (1999) 239 ITR 775 (SC) : 1999 TaxPub(DT) 1421 (SC) CIT v. Podar Cement Pvt. Ltd. & Ors. (1997) 226 ITR 625 (SC) : 1997 TaxPub(DT) 1265 (SC)Followed:CIT v. Vegetable Products Ltd. (1973) 88 ITR 192 (SC) : 1973 TaxPub(DT) 0421 (SC) CIT v. Shri Kamal Wahal (2013) 258 CTR 251 (Del) : 2013 TaxPub(DT) 1087 (Del-HC) Ponds India Ltd. v. CTT 2008 (9) SC 94 : 2008 TaxPub(EX) 1644 (SC)Distinguished:Prakash (by legal heir of assessee) v. ITO & & Ors. (2008) 312 ITR 40 (Bom) : 2009 TaxPub(DT) 0850 (Bom-HC)

REFERRED :

FAVOUR : In assessee's favour

A.Y. : 2011-12

IN THE ITAT, RANCHI BENCH

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