DEPUTY COMMISSIONER OF INCOME TAX, CIRCLE 2 1 1, AHMEDABAD, AHMEDABAD vs. BHARAT LAKHAJI NANDWANA, AHMEDABAD

ITA 1366/AHD/2025Status: DisposedITAT Ahmedabad12 March 2026AY 2017-18Bench: SHRI SIDDHARTHA NAUTIYAL (Judicial Member), SHRI NARENDRA PRASAD SINHA (Accountant Member)1 pages
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What did the Tribunal hold?

The Tribunal held that the period of holding by the previous owner (trust) should be included, making the asset a long-term capital asset. Exemption under section 54EC was allowed, but the issue of section 54 exemption was remanded for verification of actual purchase of a new residential property.

What were the facts?

The assessee claimed exemption under sections 54 and 54EC on long-term capital gains from selling a property inherited through a trust. The Assessing Officer treated the gains as short-term, denying the exemption, as the property was held by the assessee for a short period after its transfer from the trust.

What were the issues?

Whether the period of holding by the previous owner should be included for determining long-term capital gains, and whether the conditions for exemption under sections 54 and 54EC were met.

Which sections of the Income-tax Act were involved?

Section 54,Section 54EC,Section 49,Section 2(42A)

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Income Tax Appellate Tribunal, “A” BENCH, AHMEDABAD

Before: SHRI SIDDHARTHA NAUTIYAL & SHRI NARENDRA PRASAD SINHA

For Respondent: Shri S. N. Soparkar, Sr. Adv. & Ms. Ukti
Hearing: 09.03.2026

PER SIDDHARTHA NAUTIYAL - JUDICIAL MEMBER:

This appeal has been filed by the Department against the order passed by the Ld. Commissioner of Income Tax (Appeals), (in short “Ld. CIT(A)”), National Faceless Appeal Centre (in short “NFAC”), Delhi vide order dated 13.06.2025 passed for A.Y. 2017-18. 2. The Department has taken the following grounds of appeal:

“1. Whether on the facts and in the circumstances of the case and in law, the Ld. CIT(A) has erred in deleting the addition of Rs. 3,39,34,924/- on account of disallowance of exemption u/s 54 and 54EC of the Act as the assessee doe

The order continues below.

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