DEPUTY COMMISSIONER OF INCOME TAX, CENTRAL CIRCLE-3, SURAT, SURAT vs. DAMODAR BHIMJIBHAI PATEL, SURAT

ITA 259/SRT/2025Status: DisposedITAT Surat10 July 2026AY 2018-1914 pages
AI SummaryDismissed

What were the facts?

The assessee converted a capital asset (land) into stock-in-trade and declared long-term capital gains. The Assessing Officer (AO) made an addition on account of LTCG and rejected the claim for exemption under Section 54F. The CIT(A) granted relief to the assessee.

What did the Tribunal hold?

The Tribunal held that the cost of land purchased prior to the transfer of the original asset constitutes part of the cost of the new residential house for the purpose of Section 54F. It was also held that exemption under Section 54F cannot be denied merely because the unutilized amount was not deposited in the Capital Gain Account Scheme before the due date, if the entire amount was actually invested within the prescribed period.

What were the issues?

Whether the cost of land acquired before the transfer of the original asset is includible for Section 54F exemption, and whether non-deposit of unutilized capital gains in the Capital Gain Account Scheme before the due date disentitles the assessee from exemption if the amount is otherwise invested within the statutory period.

Which sections of the Income-tax Act were involved?

Section 54F,Section 45(2),Section 139(1),Section 54F(4)

AI-generated summary — verify with the full judgment below

Income Tax Appellate Tribunal, SURAT BENCH, SURAT

Before: Shri T.R. Sentil Kumar & Shri Ratnesh Nandan Sahay

PER : T.R. SENTHIL KUMAR, JUDICIAL MEMBER:-

This appeal is filed by the Revenue as against the appellate order dated 30.12.2024 passed by the Commissioner of Income Tax (Appeals)-4, Surat (hereinafter referred to as “Ld. CIT(A)”), arising out of the assessment order passed under section 143(3) r.w.s. 143(3A) & 143(3B) of the Income Tax Act, 1961 (hereinafter referred to as ‘the Act’) relating to the Assessment Year 2018-19. I.T.A No. 259//SRT/2025 A.Y. 2018-19 Page No 2

2.

Brief facts of the case are, the assessee is an individual, filed his return of i

The order continues below.

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