Non-Deposit in Capital Gains Account Scheme cannot result in denial of capital gain exemption U/s 54F if otherwise house is purchased within prescribed time frame
ITAT chennai has recently held that Sec 54F deduction could be allowed even when capital gains account scheme was not opened.
Case Detail is as under:
Shri T. Pandian (I.T.A. No.3107/Chny/2019)
Let us have a short overview of the case:
- In the assessment order, the Assessing Officer has noted that the assessee has sold the property for a consideration of Rs.60,00,000 and also claimed sale expenses of Rs.9,220. The assessee had also purchased a residential property for Rs.2,00,00,000. The assessee has claimed deduction under section 54F in respect of property purchased for consideration of 2,00,00,000.
- The Assessing Officer denied the claim of deduction under section 54F as the assessee has not fulfilled the procedural requirement laid down by the law of depositing into the capital gain account scheme with a nationalized bank before the due date of furnishing of return.
ITAT Chennai held as below:
- The provisions of section 54F of the Act are beneficial provisions and are to be considered liberally in the aspect of the limitation period.
- But the investment in residential property within the time limit is a must, which the assessee has proved with evidence and complied before the lower authorities.