INCOME TAX ACT, 1961

Section 54F

Capital gains - Exemption under section 54F - Disallowance of claim as assessee not filed any detail in support of the claim -

Assessee was engaged in the Civil Contract works and also running of vehicles and machineries on hire. During the scrutiny assessment, AO noted that assessee had claimed deduction under section 54F on account of investment of house property. AO issued a show cause notice to assessee as to why the claim under section 54F should not be disallowed as the assessee had not filed any detail in support of the claim. After considering the reply of the assessee, AO disallowed the deduction under section 54F. Held: AO cited reasons for denying the claim of deduction under section 54F and this action was challenged by assessee before CIT(A) but he had confirmed the action of AO only on one reason itself, i.e. assessee was also having more than one residential house which is inviolation of condition provided under section 54F. CIT(A) had not discussed the other grounds which AO had recorded in the assessment order along with this one which was considered by CIT(A) and further, the assessee had then produced the additional evidence in support of the claim that he had not acquired the flat in question as such, there was no violation of condition prescribed under section 54F. Therefore, matter was remanded back to CIT(A) to consider the additional evidence filed by assessee and thereafter give a finding on all the issues and grounds which were raised by AO while denying the deduction under section 54F.

REFERRED :

FAVOUR : Matter remanded

A.Y. : 2013-14

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