Partial Ownership Cannot be Considered ‘one ‘ for Disallowing

Ashok G. Chauhan  v. ACIT ITA No. 1309/MUM/2016 dt. 12/04/2019

(Mum) (Trib)

Interesting  Judgment  

Assessee  failed his return by claiming deduction u/s. 54F in respect of capital gain arising from transfer of capital assets . During the Assessment , the AO observed that at time of transfer of capital asset , assessee was owner of two residential house out of which one he had jointly purchased with his wife and therefore he owner of two flats on date of transfer of capital assets.

While deciding the issue, the Honourable Tribunal observed that a complete residential house . where the property owned by more than one person , it cannot be said that any one of them is the owner of the property . In such a case , no individual person of his own can sell the entire property. No doubt , h can sell his share of interest in the property but as far as the property is considered , it would continue to be owned by co- owners . Joint ownership is different from absolute ownership . in the case of residential unit , none of the co-owners can claim that he is the owner of residential house . Ownership of all others. Therefore, where a house is jointly owned by two or more persons, none of them can be said to be the owner of that house . so , the word “OWN” would not include a case where a residential house is partly owned by one person or partly owned by other persons.

The Honourable Tribunal held that a residential property was co-jointly owned un name of assessee and his wife, therefore he coild not be treated as ‘absolute owner’ of said property and , therefore , deduction u/s . 54F cannot be denied . (AY 2010-11)