INCOME TAX OFFICER (INTERNATIONAL TAXATION) WARD-2(1), BANGALORE vs. RAVINDRA UPADRASHTA, BANGALORE

PDF · subscribers
ITA 2342/BANG/2018Status: DisposedITAT Bangalore28 August 2019AY 2014-153 pages

In favour of the assessee: the Revenue's appeal was dismissed. From the AI summary of this appeal.

AI SummaryDismissed

What did the Tribunal hold?

The Tribunal held that at the time of the relevant assessment year, there was no statutory condition that the residential house purchased for exemption under Section 54F must be in India. Therefore, the exemption for a property purchased outside India was allowable.

What were the facts?

The assessee claimed exemption under Section 54F for purchasing a residential property in the USA. The revenue contended that the property must be located in India for the exemption to be applicable. The CIT(A) allowed the exemption, following a previous Tribunal ruling.

What were the issues?

Whether investment in a residential house situated outside India is eligible for exemption under Section 54F of the Income Tax Act, 1961.

Which sections of the Income-tax Act were involved?

Section 54F

AI-generated summary — verify with the full judgment below

Income Tax Appellate Tribunal, “B” BENCH : BANGALORE

Before: SHRI ARUN KUMAR GARODIA & SMT. BEENA PILLAI

For Appellant: Shri Parimal L Rao, CA
For Respondent: Ms. Neera Malhotra, CIT (DR)
Hearing: 26.08.2019Pronounced: 28.08.2019

O R D E R

Per Shri A.K. Garodia, Accountant Member

1.

This appeal is filed by the revenue and the same is directed against the order of ld. CIT(A)-12, Bangalore dated 19.06.2018 for Assessment Year 2014-15.

2.

The grounds raised

by the revenue are as under. “1. The order of the learned Commissioner of Income Tax (Appeals)- 12, Bengaluru is contrary to the law and facts of the case.

2. The learned Commissioner of Income Tax (Appeals)-12, Bengaluru ought to have considered the fact that in view of the statutory provisions of section 54F, the residential house must be in India.

3. The learned Commissioner of Income Tax (Appeals)-12, Bengaluru failed to appreciate the fact that in view of settled ruling of interpretation of tax statute, the residential house purchased/constructed must be in India and not outside India.

4. The learned Commissioner of Income Tax (Appeals)-12, Bengaluru Page 2 of 3 failed to consider the Memorandum explaining provisions in the Finance Bill 1982 that the exemption in section 54F is granted with a view to encouraging house construction. This would naturally mean that house construction/purchase would be encouraged by provisions of this section in India and not outside India.

5. The learned Commissioner of Income Tax (Appeals)-12, Bengaluru failed to consider the fact that the decision of the Bangalore ITAT in the case of Sri. Vinay Mishra v ACIT 30 Taxmann.com 341 has not yet become final and the same is still pending before the Hon'ble High Court of Karnataka.

6.

For these and other grounds that may be adduced at the time of hearing, it is prayed that the order of the learned Commissioner of Income Tax (Appeals) -12, Bengaluru may be cancelled and that of the AO may be restored.”

3.

The ld. DR of revenue supported the assessment order whereas the ld. AR of assessee supported the order of ld. CIT(A). He also submitted that even as per ground no. 5 raised by the revenue, this is the stand taken by the revenue that the Tribunal order rendered in the case of Sri. Vinay Mishra Vs. ACIT as reported in 30 taxmann.com 341 has not become final because appeal is filed by the revenue before Hon'ble Karnataka High Court which is still pending. He submitted that this is not the case of the revenue that issue in dispute is not covered by this Tribunal order. He further submitted that this is also not the case of the revenue that Hon’ble High Court has stayed the operation of this Tribunal order and hence, the appeal of the revenue should be dismissed.

4.

We have considered the rival submissions. We find that in para 5.3 of his order, it is noted by ld. CIT(A) that the assessee has purchased the property in USA in Financial Year 2013-14 and the amendment brought on the statute book is applicable w.e.f. 01.04.2015 as per which it has been specified that for claiming deduction u/s. 54 of the IT Act, the residential house has to be purchased or constructed in India but in the relevant period, such condition was not there that it should be in India. In the same para, the ld. CIT(A) has followed the Tribunal order rendered in the case of Sri. Vinay Mishra Vs. ACIT (supra) in which it is held by the Tribunal that the investment in the residential house situated outside India is also eligible for exemption u/s. 54F of the IT

Page 3 of 3 Act. In view of these facts and legal position, we find no reason to interfere in the order of ld. CIT(A).

5.

In the result, the appeal filed by the revenue is dismissed. Order pronounced in the open court on the date mentioned on the caption page.

More judgments on Section 54F

All 2,628 judgments and leading authorities on Section 54F →

Recent GST High Court judgments

Search GST case law →