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Income Tax Appellate Tribunal, MUMBAI BENCH “G” MUMBAI
Before: SHRI ABY T VARKEY & SHRI OM PRAKASH KANT
This appeal by the assessee is directed against the order dated 15/02/2019 passed by the Ld.CIT(A)-28, Mumbai [in short, ‘the Ld.CIT(A)] for Assessment Year 2011-12, raising following grounds:-
“1. On the facts and circumstances of the case and in law, the learned Assessing Officer has erred in reopening the assessment under Section 147 of the Act.
Shalini Anand Murthy 2 ITA 2404/Mum/2019
2. On the facts and circumstances of the case and in On the facts and circumstances of the case and in On the facts and circumstances of the case and in law, the Hon’ble Commissioner of Income Tax (Appeals) has law, the Hon’ble Commissioner of Income Tax (Appeals) has law, the Hon’ble Commissioner of Income Tax (Appeals) has erred in denying the exemption claimed by the Appellant erred in denying the exemption claimed by the Appellant erred in denying the exemption claimed by the Appellant under section 54F of the Act, amounting to ₹87,89,121/ under section 54F of the Act, amounting to 87,89,121/-“
At the outset, we may like to m At the outset, we may like to mention that ground No.1 of the ention that ground No.1 of the appeal was not pressed and, therefore, the same is dismissed as appeal was not pressed and, therefore, the same is dismissed as appeal was not pressed and, therefore, the same is dismissed as infructuous.
2.1 The only ground left is in respect of the deduction under The only ground left is in respect of the deduction under The only ground left is in respect of the deduction under section 54F of the Income section 54F of the Income-tax Act, 1961 (in short, ‘the Act’) of tax Act, 1961 (in short, ‘the Act’) of ₹87,89,121/-.
Briefly stated, facts of the case as culled out from the order of Briefly stated, facts of the case as culled out from the order of Briefly stated, facts of the case as culled out from the order of the lower authorities and submissions of the assessee are that the lower authorities and submissions of the assessee are that the lower authorities and submissions of the assessee are that – (i) In Assessment year 2008 In Assessment year 2008-09, the assessee had shown a long 09, the assessee had shown a long term capital gain of ₹5,43,70,902/- against which term capital gain of against which the assessee deposited ₹50,00,000/ 50,00,000/- under ‘Capital gains Account Scheme, under ‘Capital gains Account Scheme, 1998’ and claimed e 1998’ and claimed exemption under section 54F amounting to xemption under section 54F amounting to ₹23,50,00,000/-. Though the said claim of exemption was Though the said claim of exemption was Though the said claim of exemption was disallowed by the Assessing Officer, however, the same was allowed disallowed by the Assessing Officer, however, the same was allowed disallowed by the Assessing Officer, however, the same was allowed in the order passed by the by the Assessing Officer consequent to passed by the by the Assessing Officer consequent to passed by the by the Assessing Officer consequent to the order of the ITAT dated 26/12/2016; the order of the ITAT dated 26/12/2016; (ii) The period of 3 years 3 years deposit from the sale of original property deposit from the sale of original property expired on April 2, 2010 and the assessee was supposed to pay the expired on April 2, 2010 and the assessee was supposed to pay the expired on April 2, 2010 and the assessee was supposed to pay the Shalini Anand Murthy 3 ITA 2404/Mum/2019 capital gain tax on the unu capital gain tax on the unutilized balance lying in the capital gains tilized balance lying in the capital gains account which was of ₹2,90,29,120/-. account which was of (iii) For the year under consideration, the assessee filed regular For the year under consideration, the assessee filed regular For the year under consideration, the assessee filed regular return of income on 29/09 return of income on 29/09/2011 declaring total income at /2011 declaring total income at ₹12,83,110/-. The assessment under section 143(3) w . The assessment under section 143(3) w . The assessment under section 143(3) was completed on 31/01/2014 accepting returned income. Subsequently, the on 31/01/2014 accepting returned income. Subsequently, the on 31/01/2014 accepting returned income. Subsequently, the assessment was reopened after recording the reasons and notice assessment was reopened after recording the reasons and notice assessment was reopened after recording the reasons and notice under section 148 of the Act was issued on 27/03/2017. Since the under section 148 of the Act was issued on 27/03/2017. Since the under section 148 of the Act was issued on 27/03/2017. Since the amount of ₹2,90,29,120/ 2,90,29,120/- which was lying unutilized in lying unutilized in capital account of the scheme account of the scheme, was not offered to tax for the year under was not offered to tax for the year under consideration, the assessee was asked to explain as to why the consideration, the assessee was asked to explain as to why the consideration, the assessee was asked to explain as to why the same unutilized amount should not be taxed under section 54F(4) same unutilized amount should not be taxed under section 54F(4) same unutilized amount should not be taxed under section 54F(4) of the Act. It was submitted on behalf of the assessee of the Act. It was submitted on behalf of the assessee of the Act. It was submitted on behalf of the assessee that initially she had paid ₹10 lakhs to M/s Umiya Holdings Company Pvt Ltd 10 lakhs to M/s Umiya Holdings Company Pvt Ltd 10 lakhs to M/s Umiya Holdings Company Pvt Ltd towards booking of flat in Goa. However, said transaction was towards booking of flat in Goa. However, said transaction was towards booking of flat in Goa. However, said transaction was cancelled and subsequently the assessee entered into an agreement cancelled and subsequently the assessee entered into an agreement cancelled and subsequently the assessee entered into an agreement dated 27/11/2009 for purchase of a residential hou dated 27/11/2009 for purchase of a residential hou dated 27/11/2009 for purchase of a residential house property under construction with M/s Prestige Estates Projects Pvt Ltd, under construction with M/s Prestige Estates Projects Pvt Ltd, under construction with M/s Prestige Estates Projects Pvt Ltd, Bangalore and pursuant to the terms of agreement, the assessee Bangalore and pursuant to the terms of agreement, the assessee Bangalore and pursuant to the terms of agreement, the assessee had made payment of ₹59,70,880/- within 3 years and further had made payment of within 3 years and further payment of ₹87,89,121/ 87,89,121/- was made beyond the period of 3 ye was made beyond the period of 3 years from the date of sale of original property from the date of sale of original property. The Assessing Officer . The Assessing Officer observed that in the return of income filed in response to notice observed that in the return of income filed in response to notice observed that in the return of income filed in response to notice
Shalini Anand Murthy 4 ITA 2404/Mum/2019 under section 148, the assessee, though offered under section 148, the assessee, though offered additional capital additional capital gains to the extent of ₹2,02,39,9999/- out of the am gains to the extent of out of the amount remained unutilized, however, the amount of ₹81,89,121/- was not offered to unutilized, however, the amount of was not offered to tax. The main contention of the assessee was that the delay for tax. The main contention of the assessee was that the delay for tax. The main contention of the assessee was that the delay for utilization of the amount in ‘Capital gains Account Scheme, 1998’ utilization of the amount in ‘Capital gains Account Scheme, 1998’ utilization of the amount in ‘Capital gains Account Scheme, 1998’ was beyond her control as initial investment was beyond her control as initial investment was cancelled due to was cancelled due to unavailability of the project and the payment for second project got unavailability of the project and the payment for second project got unavailability of the project and the payment for second project got delayed on account of the builder delayed on account of the builder who did not being complete the not being complete the construction as per the time frame agreed initially. In support of construction as per the time frame agreed initially. In support of construction as per the time frame agreed initially. In support of the the contention, contention, the the assessee assessee rel relied ied on on following following judicial judicial pronouncements:-
T Shiva Kumar vs ITO 9158 ITD 329 (Bangalore Tribunal) T Shiva Kumar vs ITO 9158 ITD 329 (Bangalore Tribunal) T Shiva Kumar vs ITO 9158 ITD 329 (Bangalore Tribunal)
2. Satish Chandra Gupta vs AO (54 ITD 508) (Delhi Satish Chandra Gupta vs AO (54 ITD 508) (Delhi Satish Chandra Gupta vs AO (54 ITD 508) (Delhi Tribunal)
3. ACIT vs Kamlakar Moghe (378 ITR 561)(Bom.HC) vs Kamlakar Moghe (378 ITR 561)(Bom.HC) vs Kamlakar Moghe (378 ITR 561)(Bom.HC) 4. Sunil Kumar Saha vs ITO (156 ITD 1)(Kol.T Sunil Kumar Saha vs ITO (156 ITD 1)(Kol.T Sunil Kumar Saha vs ITO (156 ITD 1)(Kol.Trib) (iv) The Assessing Officer rejected the contention of the assessee The Assessing Officer rejected the contention of the assessee The Assessing Officer rejected the contention of the assessee and denied the claim of deduction of payment made and denied the claim of deduction of payment made and denied the claim of deduction of payment made for purchase of property beyond the period of 3 years from the date of the sale of beyond the period of 3 years from the date of the sale of beyond the period of 3 years from the date of the sale of the original property. property.
Shalini Anand Murthy 5 ITA 2404/Mum/2019 (v) On appeal, the the Ld.CIT(A) also upheld the finding of the A) also upheld the finding of the Assessing Officer observing as under: Assessing Officer observing as under:-
5.4 After going through, the relevant facts and circum 5.4 After going through, the relevant facts and circumstances of the matter, I stances of the matter, I am of the considered view as to whether, based upon the factual and of the considered view as to whether, based upon the factual and of the considered view as to whether, based upon the factual and situational matrix of the case, the question to be answered is whether situational matrix of the case, the question to be answered is whether situational matrix of the case, the question to be answered is whether or not for the successful claim the successful claim of deduction u/s,54F, has the appellant invested the eduction u/s,54F, has the appellant invested the unutilized amount remain unutilized amount remaining in the Capital Gain Account within the stipulated ing in the Capital Gain Account within the stipulated period of 3 years? In this case, this question will have to be answered years? In this case, this question will have to be answered years? In this case, this question will have to be answered in the negative, since, it is an undisputed fact that the appellant has utilized negative, since, it is an undisputed fact that the appellant has utilized negative, since, it is an undisputed fact that the appellant has utilized only Rs.59.,79,880/- till April 02, 2010, thereby making it clear that the till April 02, 2010, thereby making it clear that the till April 02, 2010, thereby making it clear that the unutilized balance amount is Rs.2,90,29,120/ amount is Rs.2,90,29,120/-. It is also relevant to note, . It is also relevant to note, however, that the appellant has made further payment of Rs.87,89,121/ however, that the appellant has made further payment of Rs.87,89,121/ however, that the appellant has made further payment of Rs.87,89,121/- in May 2012. Consequently, it was argued 2012. Consequently, it was argued that benefit of Section 54F(2) should also be that benefit of Section 54F(2) should also be allowed for these amounts as the circumstances were beyond the control of the allowed for these amounts as the circumstances were beyond the control of the allowed for these amounts as the circumstances were beyond the control of the appellant, 1 note that it is crystal clear that in case of the appellant, 1 note that it is crystal clear that in case of the appellant, 1 note that it is crystal clear that in case of the appellant, an amount of Rs.2,90,29,120/ an amount of Rs.2,90,29,120/- is the unutilized amount on which appellant has n which appellant has already paid, taxes, being unutilized amount in Capital Gains account as on already paid, taxes, being unutilized amount in Capital Gains account as on already paid, taxes, being unutilized amount in Capital Gains account as on April 03,2010 as per provisions of Section April 03,2010 as per provisions of Section 54F(4) of the Act.
5.5 Therefore, what is now relevant to be adjudicated as to what 5.5 Therefore, what is now relevant to be adjudicated as to what shall be the fate of the propriety of the allowance of the exemption u/s.54F to the of the propriety of the allowance of the exemption u/s.54F to the of the propriety of the allowance of the exemption u/s.54F to the tune of Rs.87,89,121/--, which actually represents the payment of installment in May , which actually represents the payment of installment in May , which actually represents the payment of installment in May 2012, and which payment is in apparent violation of the limit of 3 years enshrined 2012, and which payment is in apparent violation of the limit of 3 years enshrined 2012, and which payment is in apparent violation of the limit of 3 years enshrined in the provision. 5.5 It is further of pertinent importance to is further of pertinent importance to note that the proviso to Section note that the proviso to Section 54F(4) clearly enunciates that, if the amount deposited is not Utilized wholly or 54F(4) clearly enunciates that, if the amount deposited is not Utilized wholly or 54F(4) clearly enunciates that, if the amount deposited is not Utilized wholly or partially for the purchase or construction of the new asset within the period partially for the purchase or construction of the new asset within the period partially for the purchase or construction of the new asset within the period specified in sub-section section (1) of Section 54F, then the unutilized amount shall be tilized amount shall be charged u/s,45 as income of the previous year in which the period of 3 years from charged u/s,45 as income of the previous year in which the period of 3 years from charged u/s,45 as income of the previous year in which the period of 3 years from the date of transfer of the original asset expires. Hence, it is very the date of transfer of the original asset expires. Hence, it is very- -much clear that the legislature in its wisdom has taken care of a scenario the legislature in its wisdom has taken care of a scenario of partial payment as of partial payment as well. Hence, the utilization of amount of Rs.87,89,121/ Hence, the utilization of amount of Rs.87,89,121/- -, beyond the prescribed limit of 3 years is a serious substantive violation of the provisions prescribed limit of 3 years is a serious substantive violation of the provisions prescribed limit of 3 years is a serious substantive violation of the provisions of Section 54F(4). One of the basic content (4). One of the basic contentions of the appellant is that the ions of the appellant is that the limit of 3 years as discussed in detail above has been breached due to the limit of 3 years as discussed in detail above has been breached due to the limit of 3 years as discussed in detail above has been breached due to the circumstances beyond the control of the appellant as the project was delayed. circumstances beyond the control of the appellant as the project was delayed. circumstances beyond the control of the appellant as the project was delayed.
Shalini Anand Murthy 6 ITA 2404/Mum/2019
This may indeed be so, however, that does not take away an This may indeed be so, however, that does not take away any material stipulation y material stipulation from the legal position that when the legislature in its wisdom has prescribed a from the legal position that when the legislature in its wisdom has prescribed a from the legal position that when the legislature in its wisdom has prescribed a certain period i.e. in the instance matter, the limit of 3 years for utilizing the certain period i.e. in the instance matter, the limit of 3 years for utilizing the certain period i.e. in the instance matter, the limit of 3 years for utilizing the unutilized amount in the capital gain account, then this limit cannot unutilized amount in the capital gain account, then this limit cannot unutilized amount in the capital gain account, then this limit cannot be extended at the whim of the appellant. It has to be strictly at the whim of the appellant. It has to be strictly followed.” (vi) The Ld.CIT(A) further relied on the decision of the Hon’ble further relied on the decision of the Hon’ble further relied on the decision of the Hon’ble Supreme Court in the case of Commissioner of Customs (Import) Supreme Court in the case of Commissioner of Customs (Import) Supreme Court in the case of Commissioner of Customs (Import) Mumbai vs. M/s Dilip Kumar and Company and Ors 9 SCC Mumbai vs. M/s Dilip Kumar and Company and Ors 9 SCC Mumbai vs. M/s Dilip Kumar and Company and Ors 9 SCC 1 (FB)(SC) by holding that exemption provision has to be interpreted (FB)(SC) by holding that exemption provision has to be interpreted (FB)(SC) by holding that exemption provision has to be interpreted strictly. He also relied on other decisions. The relevant part of his He also relied on other decisions. The relevant part of his He also relied on other decisions. The relevant part of his decision is reproduced as under: decision is reproduced as under:- 5.6 It is of paramount importance to note that recently, a Constitution It is of paramount importance to note that recently, a Constitution It is of paramount importance to note that recently, a Constitution Bench (Bench of Five Judges) of Hon Five Judges) of Hon’ble Supreme Court of India in a ble Supreme Court of India in a Landmark Landmark judgement judgement in the case of Commissioner Commissioner of of Customs(Import)Mumbai Vs. M/s Dilip Kumar and Mumbai Vs. M/s Dilip Kumar and and Company and Ors and Company and Ors has overruled the Three d the Three-Judge judgement in the case of Judge judgement in the case of Sun Export Corporation, Bombay vs Collector of Customs, Bombay Corporation, Bombay vs Collector of Customs, Bombay [2002 [2002-TIOL-118- SC-CX-LB] (“Sun Export case” “Sun Export case”) to firmly hold that: “In case of ambiguity in a charging provision, benefit must necessarily go in “In case of ambiguity in a charging provision, benefit must necessarily go in “In case of ambiguity in a charging provision, benefit must necessarily go in favour of assessee but the same is not true for a favour of assessee but the same is not true for an exemption notification. n exemption notification. When there is ambiguity in exemption notification which is subject to strict When there is ambiguity in exemption notification which is subject to strict When there is ambiguity in exemption notification which is subject to strict interpretation, the benefit of such ambiguity cannot be claimed by the subject / interpretation, the benefit of such ambiguity cannot be claimed by the subject / interpretation, the benefit of such ambiguity cannot be claimed by the subject / assessee and it must be interpreted in favour of the rev assessee and it must be interpreted in favour of the revenue.” It shall be very clear that, the above ratio of the Hon'ble Apex Court decision It shall be very clear that, the above ratio of the Hon'ble Apex Court decision It shall be very clear that, the above ratio of the Hon'ble Apex Court decision squarely applies to the appellant, since, what is being interpreted here is the squarely applies to the appellant, since, what is being interpreted here is the squarely applies to the appellant, since, what is being interpreted here is the deduction u/s.54F. As per the above decision, all the provisions have to be strictly deduction u/s.54F. As per the above decision, all the provisions have to be strictly deduction u/s.54F. As per the above decision, all the provisions have to be strictly interpreted including the time limit of 3 years for making good the unutilized including the time limit of 3 years for making good the unutilized including the time limit of 3 years for making good the unutilized investment. In the instant case, there is breach of this limit and hence the investment. In the instant case, there is breach of this limit and hence the investment. In the instant case, there is breach of this limit and hence the appellant shall be rendered disentitled to the said deduction appellant shall be rendered disentitled to the said deduction. 5.7 The appellant has contended that since the 5.7 The appellant has contended that since the breach of the three years cap in breach of the three years cap in making the impugned investment was beyond the control of the appellant, hence, making the impugned investment was beyond the control of the appellant, hence, making the impugned investment was beyond the control of the appellant, hence,
Shalini Anand Murthy 7 ITA 2404/Mum/2019 a liberal view may be taken. Many judicial precedents were also cited. However, a liberal view may be taken. Many judicial precedents were also cited. However, a liberal view may be taken. Many judicial precedents were also cited. However, the Apex Court decision in case of M/s ourt decision in case of M/s Dilip Kumar and Company a Dilip Kumar and Company and Ors (cited supra) makes it amply clear that makes it amply clear that the provisions of any deduction section have be of any deduction section have be to construed strictly and that to construed strictly and that the earlier law relating to the liberal interpretation the earlier law relating to the liberal interpretation of the provisions now stands overruled. In the instant case as well, the ti stands overruled. In the instant case as well, the ti stands overruled. In the instant case as well, the time limit of three years "will have to be strictly interpreted going by the yardstick adopted "will have to be strictly interpreted going by the yardstick adopted "will have to be strictly interpreted going by the yardstick adopted in the case of M/s Dilip Kumar arid Company and Ors. Hence, the case laws of M/s Dilip Kumar arid Company and Ors. Hence, the case laws of M/s Dilip Kumar arid Company and Ors. Hence, the case laws quoted by the appellant will be of little assistance to the appellant. In any quoted by the appellant will be of little assistance to the appellant. In any quoted by the appellant will be of little assistance to the appellant. In any case, it is a trite law that each judicial decision is rendered in the very a trite law that each judicial decision is rendered in the very a trite law that each judicial decision is rendered in the very peculiar and factual matrix of that case and therefore it is not either factual matrix of that case and therefore it is not either judicially expedient or judicially expedient or prudent to superimpose the facts of the various ease laws cited. In this sense, prudent to superimpose the facts of the various ease laws cited. In this sense, prudent to superimpose the facts of the various ease laws cited. In this sense, each case is undisputedly unique and stands on different pedestal undisputedly unique and stands on different pedestal undisputedly unique and stands on different pedestal 5.8 Further, it would be pertinent to note that where the language is clear the 5.8 Further, it would be pertinent to note that where the language is clear the 5.8 Further, it would be pertinent to note that where the language is clear the intention of the Legislature is to be gathered, from the language used. A intention of the Legislature is to be gathered, from the language used. A intention of the Legislature is to be gathered, from the language used. A construction which requires, for its support, ad construction which requires, for its support, addition of substitution of words dition of substitution of words or which results in rejection of words, has to be avoided, unless it is covered or which results in rejection of words, has to be avoided, unless it is covered or which results in rejection of words, has to be avoided, unless it is covered 'by the rule of exception, including that of necessity the rule of exception, including that of necessity (see Gwalior Rayon Silk (see Gwalior Rayon Silk Mfg. (Wvg.) Co. Ltd, v. Custodian of Vested Forests, Palghat A/R Mfg. (Wvg.) Co. Ltd, v. Custodian of Vested Forests, Palghat A/R Mfg. (Wvg.) Co. Ltd, v. Custodian of Vested Forests, Palghat A/R 1990 SO 1747; Smt, Shyam Kishori Devi m Kishori Devi v. Patna Municipal Corporation AIR Patna Municipal Corporation AIR 1966 SC 1678; A.M. Antuluy v. Ramdas Sriniwas Nayak Antuluy v. Ramdas Sriniwas Nayak [19S4] 2 SCR 914). Indeed [19S4] 2 SCR 914). Indeed the Court cannot refram the Court cannot reframe the legislation as it has no power to legislate e the legislation as it has no power to legislate (State of Kerala. v. Mathai Verghese ai Verghese[1987] 1 SCR 317; Union of India v. Deoki Union of India v. Deoki Nandan Aggarwal AlR 1992 SC AlR 1992 SC 96). When words used are not ambiguous, literal meaning has to be applied When words used are not ambiguous, literal meaning has to be applied When words used are not ambiguous, literal meaning has to be applied (Dental Council of India v. Hari Prakash (Dental Council of India v. Hari Prakash [200 Ij 8 SCC 61). There is no [200 Ij 8 SCC 61). There is no question of interpretation if the words of the statute are clear. interpretation if the words of the statute are clear. interpretation if the words of the statute are clear. Grammatical construction has been accepted as the golden rule Grammatical construction has been accepted as the golden rule Grammatical construction has been accepted as the golden rule (Raghunandan Saran Ashok Saran (Raghunandan Saran Ashok Saran v. Pearey Lal Workshop (P) Ltd. AIR Pearey Lal Workshop (P) Ltd. AIR 1986 SC 1682). The hon'ble Supreme Court SC 1682). The hon'ble Supreme Court observed as follows in observed as follows in S.P. Gupta v. President of India MR President of India MR 1982 SC 149 :
"But there is one principle on which, there is complete unanimity of all the "But there is one principle on which, there is complete unanimity of all the "But there is one principle on which, there is complete unanimity of all the courts in the world and. this is that where words or the language used in a courts in the world and. this is that where words or the language used in a courts in the world and. this is that where words or the language used in a statute are clear and cloudl statute are clear and cloudless, plain, simple and explicit unclouded, ess, plain, simple and explicit unclouded, intelligible and pointed so intelligible and pointed so as to admit no ambiguity no room for deriving to admit no ambiguity no room for deriving support from external aids. In such cases, the statute should support from external aids. In such cases, the statute should support from external aids. In such cases, the statute should be interpreted on the face of the language or itself without, adding, subt on the face of the language or itself without, adding, subtracting or omitting. racting or omitting. words therefrom.. It is crystal. words therefrom.. It is crystal. Clear in the present case, the stipulation of the in the present case, the stipulation of the Shalini Anand Murthy 8 ITA 2404/Mum/2019 limit of three years cannot cannot be liberally extended, since, the legislature, in" its the legislature, in" its wisdom has prescribed the said limit. prescribed the said limit. 5.9 Further, the following is 5.9 Further, the following is noted: The first and primary rule of construction is that the intention of the The first and primary rule of construction is that the intention of the The first and primary rule of construction is that the intention of the Legislature must be found in the words used by the Legislature itself, The Legislature must be found in the words used by the Legislature itself, The Legislature must be found in the words used by the Legislature itself, The question is not what may be supposed and has been intended but question is not what may be supposed and has been intended but question is not what may be supposed and has been intended but what has been said. "Statutes should b "Statutes should be construed not as Elucid”. Judge Hand said, not as Elucid”. Judge Hand said, “but words must be construed with some imagination of the purposes which “but words must be construed with some imagination of the purposes which “but words must be construed with some imagination of the purposes which lie behind them” (see Lenigh Valley Coal Co. v. Yensavage 218 FR 547). This lie behind them” (see Lenigh Valley Coal Co. v. Yensavage 218 FR 547). This lie behind them” (see Lenigh Valley Coal Co. v. Yensavage 218 FR 547). This view was reiterated in (Union of India v. Filip Tiago De Gam view was reiterated in (Union of India v. Filip Tiago De Gama of Vedem Dee a of Vedem Dee Gama AIR 1990 SC 981); Literal rule is the principle rule for determining Literal rule is the principle rule for determining Gama AIR 1990 SC 981); the legislative intent. 5.10 There is only one principle of construction, namely, to ascertain what 5.10 There is only one principle of construction, namely, to ascertain what 5.10 There is only one principle of construction, namely, to ascertain what Parliament meant by using the language of the statute. Parliament meant by using the language of the statute. All other principles of All other principles of construction are no more than guides assist the task of interpretation (Lord construction are no more than guides assist the task of interpretation (Lord construction are no more than guides assist the task of interpretation (Lord Hoffman in Macniven H ven H.M. Inspector of Taxes v, Westmorland Investments M. Inspector of Taxes v, Westmorland Investments Ltd. [2001] 2 WLR 337 (HL); 2 WLR 337 (HL); [2002] 255 ITR 612). It is further of particular It is further of particular importance to note that the courts must avoid the importance to note that the courts must avoid the danger of a priori determination of the meaning of a provision based on their danger of a priori determination of the meaning of a provision based on their danger of a priori determination of the meaning of a provision based on their predetermined notions of ideological structure or scheme into predetermined notions of ideological structure or scheme into predetermined notions of ideological structure or scheme into which the provision to be interpreted is somewhat, fitted; provision to be interpreted is somewhat, fitted; they are not entitled to usurp entitled to usurp legislative function under the disguise of under the disguise of interpretation (D.R. Venkatachalam interpretation (D.R. Venkatachalam v. Deputy Transport Comrnissionor Deputy Transport Comrnissionor 1977 SC 842); 5.11 While interpreting a provision, the court only interprets the law and While interpreting a provision, the court only interprets the law and While interpreting a provision, the court only interprets the law and cannot legislate. If a provision of law is misused and subjected to the provision of law is misused and subjected to the provision of law is misused and subjected to the abuse of the process of the law, it is for the Legislature to amend, modify the process of the law, it is for the Legislature to amend, modify the process of the law, it is for the Legislature to amend, modify or repeal it, if deemed necessary (see Rishab Agro Industries Lid. v, P.N.B.Capital Ltd. (see Rishab Agro Industries Lid. v, P.N.B.Capital Ltd. (see Rishab Agro Industries Lid. v, P.N.B.Capital Ltd. (2000J 101 Comp. Gas. 284: [20 (2000J 101 Comp. Gas. 284: [2000] 5 SCC 515); the 00] 5 SCC 515); the legislative casus omissus cannot be supplied by judicial interpretative cannot be supplied by judicial interpretative cannot be supplied by judicial interpretative principle. In interpreting a particular provision of law to ascertain the interpreting a particular provision of law to ascertain the meaning and intendment meaning and intendment of the legislature, the court should presume the court should presume that the provision was designed provision was designed to effectuate a particular object to meet to effectuate a particular object to meet a particular a particular requirement [Easland Combines v. Collector of Combines v. Collector of Central Excise [2003] 1 Central Excise [2003] 1 RC 29(SC)].
Shalini Anand Murthy 9 ITA 2404/Mum/2019 5.12 In view of the above factual and legal matrix, I find that the action of the of the above factual and legal matrix, I find that the action of the of the above factual and legal matrix, I find that the action of the AO in making the impugned disallowance cannot be faulted and as such the AO in making the impugned disallowance cannot be faulted and as such the AO in making the impugned disallowance cannot be faulted and as such the disallowance u/s.54F is upheld. Consequently, the ground nos. 1 ,2 & 3 stand disallowance u/s.54F is upheld. Consequently, the ground nos. 1 ,2 & 3 stand disallowance u/s.54F is upheld. Consequently, the ground nos. 1 ,2 & 3 stand DISMISSED.”
Before us, the Ld.Counsel of the assessee Before us, the Ld.Counsel of the assessee has relied on the has relied on the decisions which were cited before the Ld.CIT(A) and in view of the decisions which were cited before the Ld.CIT(A) and in view of the decisions which were cited before the Ld.CIT(A) and in view of the decisions, he submitted that provisions of the Act should be decisions, he submitted that provisions of the Act should be decisions, he submitted that provisions of the Act should be construed liberally due to situations beyond control of the assessee. construed liberally due to situations beyond control of the assessee. construed liberally due to situations beyond control of the assessee.
The Ld.DR, on the other hand, relied The Ld.DR, on the other hand, relied on the order on the orders of the lower authorities.
We have heard the rival submissions of the parties on this We have heard the rival submissions of the parties on this We have heard the rival submissions of the parties on this issue and perused the relevant materials on record. The issue in issue and perused the relevant materials on record. The issue in issue and perused the relevant materials on record. The issue in dispute involved is regarding the dispute involved is regarding the proviso below section 54F(4) roviso below section 54F(4) which clearly states that if the amount deposited into the t if the amount deposited into the t if the amount deposited into the “Capital gain Account Scheme” is not utilized wholly or partially for the purchase is not utilized wholly or partially for the purchase is not utilized wholly or partially for the purchase or construction of the new asset within the period specified in sub or construction of the new asset within the period specified in sub or construction of the new asset within the period specified in sub section (1) of section 54F i.e. within 3 years from the date of section (1) of section 54F i.e. within 3 years from the date of section (1) of section 54F i.e. within 3 years from the date of transfer of the original asset, then the unutilized amount shall be er of the original asset, then the unutilized amount shall be er of the original asset, then the unutilized amount shall be charged under section 45 as income of the previous year in which charged under section 45 as income of the previous year in which charged under section 45 as income of the previous year in which the period of 3 years from the date of transfer of the original asset the period of 3 years from the date of transfer of the original asset the period of 3 years from the date of transfer of the original asset expires. The contention of the assessee in the instant cas expires. The contention of the assessee in the instant cas expires. The contention of the assessee in the instant case is that amount of ₹87,89,121/ 87,89,121/- was paid in the month of May, 2010 was paid in the month of May, 2010 should be considered for deduction under section 54F of the Act, should be considered for deduction under section 54F of the Act, should be considered for deduction under section 54F of the Act, whereas the period of 3 years from the date of the transfer of the whereas the period of 3 years from the date of the transfer of the whereas the period of 3 years from the date of the transfer of the Shalini Anand Murthy 10 ITA 2404/Mum/2019 original asset expired in April, 2010. It is submitted original asset expired in April, 2010. It is submitted original asset expired in April, 2010. It is submitted that the delay in investment beyond the period of 3 years was beyond control of in investment beyond the period of 3 years was beyond control of in investment beyond the period of 3 years was beyond control of the assessee and mainly due to the delay on account of the builder the assessee and mainly due to the delay on account of the builder the assessee and mainly due to the delay on account of the builder not being able to complete the construction as per the time frame not being able to complete the construction as per the time frame not being able to complete the construction as per the time frame agreed initially. During the course of hea agreed initially. During the course of hearing, the Ld.Counsel of the ring, the Ld.Counsel of the assessee was asked to submit necessary documents in support of assessee was asked to submit necessary documents in support of assessee was asked to submit necessary documents in support of the contention that delay in investment by the assessee was due to the contention that delay in investment by the assessee was due to the contention that delay in investment by the assessee was due to the delay on the part of the builder in not complet the delay on the part of the builder in not complet the delay on the part of the builder in not completing the construction as per the time frame. Ho construction as per the time frame. However, no such evidences wever, no such evidences were furnished before us. were furnished before us. In such circumstances, the ratio , the ratio of the decisions relied upon by the Ld.Counsel of the assessee cannot be decisions relied upon by the Ld.Counsel of the assessee cannot be decisions relied upon by the Ld.Counsel of the assessee cannot be applied over the facts of the instant case applied over the facts of the instant case. Further, as noted by the Further, as noted by the Ld.CIT(A) that the provisions Ld.CIT(A) that the provisions claiming exemption claiming exemption has to be interpreted strictly, in this regard the Ld.CIT(A) has interpreted strictly, in this regard the Ld.CIT(A) has interpreted strictly, in this regard the Ld.CIT(A) has followed the binding precedent of the Hon’ble Supreme Court. The relevant part binding precedent of the Hon’ble Supreme Court. The relevant part binding precedent of the Hon’ble Supreme Court. The relevant part of the order of Ld.CIT(A) of the order of Ld.CIT(A) has already been reproduced reproduced above:- 9. In view of the above facts and circumstances and the binding In view of the above facts and circumstances and the binding In view of the above facts and circumstances and the binding precedent followed by the Ld.CIT(A) on the issue in dispute, we do precedent followed by the Ld.CIT(A) on the issue in dispute, we do precedent followed by the Ld.CIT(A) on the issue in dispute, we do not find any error in the order of the Ld.CIT(A) on the issue and not find any error in the order of the Ld.CIT(A) on the issue and not find any error in the order of the Ld.CIT(A) on the issue and accordingly, we uphold the same. Ground 2 of the appeal of th accordingly, we uphold the same. Ground 2 of the appeal of th accordingly, we uphold the same. Ground 2 of the appeal of the assessee is accordingly dismissed. assessee is accordingly dismissed.
Shalini Anand Murthy 11 ITA 2404/Mum/2019
In the result, appeal of the assessee is dismissed. In the result, appeal of the assessee is dismissed. In the result, appeal of the assessee is dismissed.
Order pronounced under Rule 34(4) of the ITAT Rules, Order pronounced under Rule 34(4) of the ITAT Rules, Order pronounced under Rule 34(4) of the ITAT Rules, 1963 on 12/01/2023. 01/2023.