Triplex flat constitutes a single residential unit for Section 54 Exemption: ITAT Mumbai




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Triplex flat constitutes a single residential unit for Section 54 Exemption: ITAT Mumbai

 

Bhaskar Prataprai Shah Vs DCIT (ITAT Mumbai) Appeal Number : ITA No. 3698/Mum/2023

Facts:

1. The assessee had claimed deduction under section 54F of the Income Tax Act amounting to Rs. 4,72,22,936/- against Long Term Capital Gain on sale of shares.

2. In support of deduction claimed under section 54F of the Act, the assessee had purchased three flats i.e. Flat No. 2202, 2203 and 2103 for an amount of ₹.3,39,74,050/-, ₹.3,80,55,400/- and ₹.3,80,55,400/- respectively.

3. The assessee maintained that the three flats is a triplex flat i.e. only one residential house connected internally as per approved plans. There is unity of structure with a common living room, common passage, interconnected stairs, a common kitchen and dining area.

4. The Assessing Officer rejected the same and observed from Section 54F that a residential house has to be purchased by the assessee after sale of other assets.

ITAT Mumbai held as below:

1. The assessee has sold the shares and out of the sale proceeds he purchased three flats with interconnectivity. We also verified the agreement submitted before us which clearly shows that assessee has purchased one triplex flat which consists of a common living area, one kitchen and three rooms.

2. In common parlance, a residential unit consist of living area, one kitchen and rooms. The triplex flat purchased by the assessee which has common living area, common kitchen and several rooms which satisfies the definition of a single residential unit.

3. We observe that assessee has submitted a floor plan from the builder which encompasses triplex nature of flat and has been attached along with the registered sale deed which clearly shows that triplex nature of unit purchased by the assessee were approved and accepted by the builder.

4. In the light of the discussion, the claim of the assessee is found to be just and proper. Accordingly, ground raised by the assessee is allowed.

 

The copy of the Appellate is as under:

1711513773-ITA 3698 M 2023-BHASKAR PR4AJAPATI SHAH-sd DT 22 MAR 2024




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