July 2019

Section 54 – Condition of not owning more than a residential house on the date of transfer of the original asset would mean absolute ownership and does not cover within its sweep a case where the assessee jointly owns residential house together with someone else

Jagdish T.Punjabi|Devendra Jain | Tejaswini Ghag
Chartered Accountants

16[2019] 105 taxmann.com 204 (Mum) Ashok G. Chauhan vs. ACIT ITA No. 1309/Mum/2016 A.Y.: 2010-11 Date of order: 12th April, 2019

 

Section 54 – Condition of not owning more than a residential house on the date of transfer of the original asset would mean absolute ownership and does not cover within its sweep a case where the assessee jointly owns residential house together with someone else

 

FACTS

The assessee, an individual, filed his return of income after claiming deduction u/s. 54F of the Income-tax Act, 1961 (“the Act”) in respect of capital gains arising from transfer of tenancy rights. In the course of re-assessment proceedings, the Assessing Officer (AO) observed that the assessee was owner of two residential houses, one of which was jointly held by him with his wife. The AO rejected the claim for deduction u/s. 54F on the ground that the assessee owned two flats on the date of transfer of tenancy rights.

 

Aggrieved, the assessee preferred an appeal to the Commissioner of Income-tax (Appeals) who upheld the order passed by the AO.

 

HELD

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