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investment u/s 54EC

Started by CA.BHUPENDRASHAH, December 24, 2011, 09:34:21 PM

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CA.BHUPENDRASHAH

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 

satyanveshi

The situation is very typical. But the answer is  "No".

sai prasad

the investment  should have been made in 11-12 so that the cap of Rs.50 lakhs in a year could have been avoided.

sai prasad

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.

CA.BHUPENDRASHAH


[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