| Question And Answer | |
|---|---|
| Subject: | Source of Fund for investing in Sec 54EC |
| Category: | Income-Tax |
| Querist: | Shreya Mehta |
| Answered by: | Advocate Shashi Ashok Bekal |
| Tags: | Exemption u/s 54EC, Section 54EC deduction |
| Date: | August 3, 2022 |
Assessee has agreed to sell a flat and made agreement with buyer, possession of flat is also given within time but consideration of flat is not received from buyer . Now question is they want to claim exemption by investing in 54EC Bond but the Sale consideration is not yet received. Stipulated time of investing in 54EC is over and still consideration is not received, is any case law to prove that transfer is still not completed as consideration is not received.
It is a well settled position in law that a taxpayer claiming for an exception/deduction or any beneficial provision to reduce any tax obligation must prove that the said provision covers him. Hence the stricter rule of interpretation is adopted for interpreting beneficial provisions in the said cases.
Further, the Kolkata Bench of the Income Tax Appellate Tribunal in the case of Chanchal Kumar Sircar v. ITO [2012] 18 taxmann.com 304/50 SOT 289, where issue for Tribunal’s consideration was whether six months’ time in terms of section 54EC of the Act is to be reckoned from when the payment is received in instalments or from the date of the constructive transfer of the capital asset or from the dates when various instalments are received. It was held that the date of transfer would be deemed to be the date when the constructive transfer takes place and, hence, six months period should be counted from that date, irrespective of the receipt of the consideration on other dates in installments.