can one invest one crore in one financial year 2012-13 in respect of two LT CG earned , say one in FY 2011-12 & second in FY 2012-13 ? Assuming six months are not over for first LT CG
The situation is very typical. But the answer is "No".
the investment should have been made in 11-12 so that the cap of Rs.50 lakhs in a year could have been avoided.
the cap is reckoned for the whole year. this comes in the way of making invetment in one year although they relate to two years.
[2012] 19 taxmann.com 27 (Jaipur - Trib.)
IN THE ITAT JAIPUR BENCH 'A'
Assistant Commissioner of Income-tax, Circle-2, Ajmer
v.
Shri Raj Kumar Jain & Sons (HUF)*
R.K.GUPTA, JUDICIAL MEMBER
AND N.L.KALRA, ACCOUNTANT MEMBER
IT APPEAL NO. 648 (JP.) OF 2011
[ASSESSMENT YEAR 2008-09]
JANUARY 31, 2012
Section 54EC of the Income-tax Act, 1961 - Capital gains - Not to be charged on investment in certain bonds - Assessment Year 2008-09 - Assessee sold a property on 13-12-2007 and disclosed capital gain - Assessee invested said capital gain amounting to Rs. 1 crore in specified capital gain bond (i.e., Rs. 50 lakhs on 31-3-2008 + Rs. 50 lakhs on 10-6-2008) and claimed exemption under section 54EC - Assessing Officer by relying upon proviso to section 54EC held that assessee having made a claim of Rs. 1 crore, exceeded investment limit prescribed in proviso and, accordingly, restricted deduction to Rs. 50,00,000 - On appeal, Commissioner (Appeals) held that investment of Rs. 50,00,000 each had been made during two financial years, i.e., financial years 2007-08 and 2008-09, and in either of two cases, investment was made within time-limit of six months from date of transfer and, therefore, assessee was entitled to deduction of Rs. 1,00,00,000 under section 54EC - Whether as per section 54EC investment within 6 months is investment for that particular financial year in which transfer has taken place and said period of six months would not include some part of subsequent financial year - Held, yes - Whether in view of above only investment of 50 Rs. lakhs made on 31-3-2008 fell within time-limit of six months from date of transfer, i.e., 13-12-2007 for financial year 2007-08 - Held, yes - Whether, therefore, Commissioner (Appeals) was not justified in allowing deduction to assessee to extent of Rs. 1 crore under section 54EC - Held, yes [In favour of revenue]
Circulars & Notifications: Notification No. 380, dated 22-12-2006