{"id":4475,"date":"2012-03-08T15:32:24","date_gmt":"2012-03-08T15:32:24","guid":{"rendered":"http:\/\/itatonline.org\/archives\/?p=4475"},"modified":"2012-03-08T15:32:24","modified_gmt":"2012-03-08T15:32:24","slug":"cit-vs-sambandam-udaykumar-karnataka-high-court-s-54f-does-not-require-construction-to-be-complete-within-specified-period","status":"publish","type":"post","link":"https:\/\/itatonline.org\/archives\/cit-vs-sambandam-udaykumar-karnataka-high-court-s-54f-does-not-require-construction-to-be-complete-within-specified-period\/","title":{"rendered":"CIT vs. Sambandam Udaykumar (Karnataka High Court)"},"content":{"rendered":"\n\n
Click here to download the judgement (sambandam_udaykumar_54F_construction.pdf) <\/strong> <\/a><\/p><\/td>\n<\/tr>\n<\/table>\n


\nS. 54F does not require construction to be complete within specified period
\n<\/strong><\/p>\n

The assessee sold shares for Rs. 4.18 crores and, within 12 months, invested Rs. 2.16 crores thereof to construct a house property and claimed exemption u\/s 54F. However, as even after the expiry of 3 years of the date of transfer, the construction of the house was not complete and sale deed not executed<\/em>, the AO & CIT (A) denied relief u\/s 54F though the Tribunal granted it. On appeal by the department to the High Court, HELD dismissing the appeal:<\/p>\n

S. 54F is a beneficial provision for promoting the construction of residential house & requires to be construed liberally<\/strong> for achieving that purpose. The intention of the Legislature was to encourage investments<\/strong> in the acquisition of a residential house and completion of construction or occupation is not the requirement of law<\/em><\/strong>. The words used in the section are ‘purchased’ or ‘constructed’. The condition precedent for claiming benefit u\/s 54F is that the capital gain should be parted by the assessee and invested either in purchasing a residential house or in constructing a residential house. Merely because the sale deed had not been executed or that construction is not complete<\/strong> and it is not in a fit condition to be occupied does not disentitle the assessee to claim s. 54F relief (Sardarmal Kothari<\/strong> 302 ITR 286 (Mad) followed)<\/p><\/blockquote>\n

<\/p>\n","protected":false},"excerpt":{"rendered":"

S. 54F is a beneficial provision for promoting the construction of residential house & requires to be construed liberally<\/strong> for achieving that purpose. The intention of the Legislature was to encourage investments<\/strong> in the acquisition of a residential house and completion of construction or occupation is not the requirement of law<\/em><\/strong>. The words used in the section are ‘purchased’ or ‘constructed’. The condition precedent for claiming benefit u\/s 54F is that the capital gain should be parted by the assessee and invested either in purchasing a residential house or in constructing a residential house. Merely because the sale deed had not been executed or that construction is not complete<\/strong> and it is not in a fit condition to be occupied does not disentitle the assessee to claim s. 54F relief (Sardarmal Kothari<\/strong> 302 ITR 286 (Mad) followed)<\/p>\n

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