Assessee can claim exemption under section 54F as well as under section 54EC for respective amounts of capital gains invested in new house and specified bonds
Facts
- Assessee derived long-term capital gains from sale of ancestral property of Rs. 3.40 crores. Out of Rs. 3.40 crores, assessee invested Rs. 2.60 crores in new house for which he claimed exemption under section 54F. He invested also Rs. 50 lakhs in REC bonds for which he claimed exemption under section 54EC
- AO denied assessee's claim on the ground that when assessee availed exemption under section 54F, the balance amount can only be deposited in account opened under Capital Gains Account Scheme,1988 and not for any investment under section 54EC bonds.
- CIT(A) allowed assessee's appeal and allowed assessee's claim
Held
- In the instant case, assessee has not claimed double deduction for the same amount under two sections.
- Assessee claimed exemption under section 54F as well as under section 54EC for respective amounts of capital gains invested in new house and specified bonds (REC bonds). There is no bar on claiming exemptions under section 54F as well as under section 54EC for respective amounts invested in new house and specified bonds (REC bonds) provided conditions of both sections are satisfied.
- As section 54EC uses the expression 'the whole or any part of capital gains in the long-term specified assets', exemption under section 54EC available even when part of capital gains invested in specified bonds within the time-limit stipulated in section 54EC. Once conditions in section 54EC are complied with, deduction not deniable on the grounds that assessee has availed of exemption under section 54F (in respect of balance amount of capital gains)
What is section 54EC read here
Read about section 54F
Assistant Commissioner of Income-tax, Cr-23(2) v. Deepak S. Bheda
IT APPEAL NO. 5011 (MUM.) 2010 [ASSESSMENT YEAR 2007-08] JUNE 15, 2012
Assistant Commissioner of Income-tax, Cr-23(2) v. Deepak S. Bheda
IT APPEAL NO. 5011 (MUM.) 2010 [ASSESSMENT YEAR 2007-08] JUNE 15, 2012
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