Benefits to assessee by AO held to be in conformity of Sec. 54F (of Income Tax Act, 1961), HC
Benefits to assessee by AO held to be in conformity of Sec. 54F (of Income Tax Act, 1961), HC
Assessee filed return which included capital gain. AO allowed benefit u/s 54F (of Income Tax Act, 1961) to assessee. CIT(A) held AO erroneous & its order prejudicial to interest of revenue. Tribunal held, benefit given to assessee in conformity with Sec. 54F (of Income Tax Act, 1961). On appeal HC held, after sale, amt. spent in construct'n of house is more than considerat'n received by sale of agricultural land & thus, entitled to benefit of Sec. 54F (of Income Tax Act, 1961). Hence, no infirmity in Tribunal's order.-000315
Facts in Brief:
1. The assessee filed his return of income which included capital gain. The Assessing Authority allowed the benefit under section 54F (of Income Tax Act, 1961) to the assessee.
2. CIT (A) was of view that the Assessing Authority had not taken into consideration the housing loan which was also invested in the construction of a house and therefore, he arrived at a conclusion that the order of the Assessing Authority was erroneous and prejudicial to the interest of the revenue.
3. The Tribunal held that the benefit extended to the assessee was strictly in conformity with section 54F (of Income Tax Act, 1961). There is no scope for the different interpretation as sought to be made out by the Revisional Authority and therefore, he allowed the appeal setting aside the order passed by the Revisional Authority.
On appeal HC held as under:
4. It is not in dispute that the assessee sold the agricultural land and the consideration received is in the nature of a long-term capital gain. Even before the sale of the property, he had borrowed housing loan and started construction on the site belonging to him. After the sale, the amount spent towards construction of the house is more than the consideration received by the sale of agricultural land and therefore, he is entitled to the benefit of section 54F (of Income Tax Act, 1961).
5. Therefore, there is no infirmity in the order passed by the Tribunal which calls for interference. Accordingly, the substantial question of law is answered in favour of the assessee and against the revenue.
Case Reference-Commissioner of Income-tax, Bangalore v. Anandraj
HIGH COURT OF KARNATAKA
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