Section 54F(4) of the Income Tax Act

Income-tax Act, 2025: s.86

Section 54F(4) falls under section 54F of the Income-tax Act, 1961, which corresponds to section 86 (Capital gains on transfer of certain capital assets not to be charged in case of investment in residential house) of the Income-tax Act, 2025.

Read section 86 of the 2025 Act

Correspondence checked against the ICAI tabular mapping of the two Acts and the BharatTax.co section commentary.

The decision most relied on for Section 54F(4) is CIT v. K. Ramachandra Rao (56 Taxmann.com 163), cited in 62 of the 26 judgments on BharatTax that turn on this section.

Leading authorities on Section 54F(4)

CIT v. K. Ramachandra Rao
56 Taxmann.com 163 · 2015 · High Court
62
citing judgments

The exemption under Section 54F (or Section 54) for long-term capital gains cannot be denied if the assessee invests the entire sale consideration in constructing a residential house within the prescribed three-year period, even if the amount was not deposited in the Capital Gains Account Scheme before the due date for filing the income tax return under Section 139(1). The purpose of the Capital Gains Account Scheme is to preserve the exemption when actual investment is pending, not to deny it if actual utilization occurs within the statutory timeframe.

Humayun Suleman Merchant v. CCIT
387 ITR 421 · 2016 · High Court
41
citing judgments

An assessee is not entitled to the full deduction under section 54F if the capital gains were not utilized for the construction of a new house or deposited in the specified bank accounts before filing the return of income. In such cases, the exemption is restricted proportionately to the amount invested.

Humayun Suleman Merchant v. Chief CIT
242 Taxmann 189 · 2016 · High Court
6
citing judgments

Judgments on Section 54F(4)

ITO-8(2)(1), Mumbai vs. Sahil Rajesh Vora, Mumbai

In the result, Revenue’s appeal is dismissed

ITA 4811/MUM/2026[2023-24]Status: DisposedITAT Mumbai23 Sept 2026AY 2023-24

Bench: Shri Narender Kumar Choudhry & Shri Prabhash Shankarincome Tax Officer - V/S. Sahil Rajesh Vora 8(2)(1),Room No. 209, 2Nd बनाम 508, Olympus Co Operative Floor, Aayakar Bhavan, M. K. Hsg Society, 5C Altamount Road, Churchgate, Mumbai – Road, Mumbai – 400020, Maharashtra 400026,Maharashtra स्थायी लेखा सं./जीआइआर सं./Pan/Gir No: Aewpv1684D Appellant/अपीलार्थी .. Respondent/प्रतिवादी

For Appellant: Mandar Vaidya, ARFor Respondent: Shri Rajesh Sakhardande,(Sr.DR)
Section 139(1)Section 143(3)Section 54F

Rachna Jain, Delhi vs. ITO, Jaipur

The appeal of the assessee is allowed

ITA 1890/JPR/2025[2015-16]Status: DisposedITAT Jaipur24 Aug 2026AY 2015-16

Bench: Smt. Annapurna Gupta & Shri Udayan Dasguptarachna Jain Vs. The Ito, P-50, Second Floor, Ward-2(1), South Extension, Part- Jaipur. Ii, New Delhi-110049. "थायीलेखासं./जीआइआरसं./Pan/Gir No:Agcpj8520G Appellant .. Respondent Appellant By : Sh. Ruchesh Sinha, Adv. Respondent By : Smt. Namita Patel, Jcit Date Of Hearing 01.07.2026 Date Of Pronouncement 24.08.2026 O R D E R Per Annapurna Gupta: The Present Appeal Has Been Filed By The Assessee Against The Order Passed By The Office Of The Commissioner Of Income Tax (Appeals), Addl/Jcit(A), Panaji (Hereinafter Referred To As “Ld. Cit(A)”), Dated 16.10.2025 Under Section 250 Of The Income Tax Act, 1961 (Hereinafter Referred To As “The Act”).

For Appellant: Sh. Ruchesh Sinha, AdvFor Respondent: Smt. Namita Patel, JCIT
Section 250Section 54FSection 54F(4)

Deputy Commissioner of Income Tax, Central Circle-3, Surat vs. Damodar Bhimjibhai Patel, Surat

In the result, the appeal filed by the Revenue is hereby dismissed

ITA 259/SRT/2025[2018-19]Status: DisposedITAT Surat10 Jul 2026AY 2018-19
Section 143(3)Section 45(2)Section 54ESection 54F

Sumit H Bhagchandani, Ahmedabad vs. DCIT, Circle 3(1)(1), Ahmedabad

In the result, the appeal of the assessee is dismissed

ITA 1984/AHD/2025[2017-18]Status: DisposedITAT Ahmedabad23 Feb 2026AY 2017-18

Bench: Shri Siddhartha Nautiyal & Shri Narendra Prasad Sinha

For Appellant: Shri Parin Shah, ARFor Respondent: Shri Yogesh Mishra, Sr. DR
Section 270ASection 54FSection 54F(1)Section 54F(4)

Shaziya Moazzam Ali Khan, Mumbai vs. Commissioner of Income-Tax (A), Mumbai

ITA 6302/MUM/2025[2013-2014]Status: DisposedITAT Mumbai04 Dec 2025AY 2013-2014

Bench: Shri Sandeep Gosain (Jm) & Shri Omkareshwar Chidara (Am) Shaziya Moazzam Ali Khan The Cit(A), Ward Flat No. 71, A Wing, St 19(3)(1), Piramal Andrew Apartment, Moraland Vs. Chamber, Parel Road, Mumbai-400 008. Mumbai-400 012. Pan : Amnpk2105R Appellant Respondent

For Appellant: Shri Aditya RaiFor Respondent: Shri Amir H. Bohra, CA
Section 250Section 54Section 54(1)Section 54(2)Section 54(4)Section 54F(1)Section 54F(4)

Kamaluddin Hamed Salmani, Hyderabad vs. DCIT., Circle 9(1), Hyderabad

ITA 1284/HYD/2025[2016-17]Status: DisposedITAT Hyderabad31 Oct 2025AY 2016-17

Bench: SHRI G. MANJUNATHA, HON’BLE (Accountant Member), SHRI RAVISH SOOD, HON’BLE (Judicial Member)

Section 139(1)Section 142(1)Section 143(3)Section 147Section 148Section 194Section 45

Ninad Arun Diwakar, Nashik vs. ITO, ACIT Circle 1, Nashik

In the result, appeal of the assessee is allowed for statistical purpose

ITA 1318/PUN/2025[2022-23]Status: DisposedITAT Pune17 Sept 2025AY 2022-23

Bench: Ms.Astha Chandra & Dr.Dipak P. Ripoteआयकर अपऩल सं. / Ita No.1318/Pun/2025 निर्धारण वषा / Assessment Year: 2022-23 Ninad Arun Diwakar, V The Income Tax Officer, Plot No.F-98, Midc, S Acti Circle-1, Nashik. Satpur Nashik – 422007. Pan: Ahepd7516M Appellant/ Assessee Respondent / Revenue Assessee By Ca Sarang Gudhate Revenue By Shri Ajay Kumar Keshari Date Of Hearing 15/09/2025 Date Of Pronouncement 17/09/2025 आदेश/ Order Per Dr. Dipak P. Ripote, Am: This Is An Appeal Filed By The Assessee Against The Order Of Ld.Commissioner Of Income Tax(Appeal)[Nfac], Delhi Passed Under Section 250 Of The Income Tax Act, 1961 Dated 24.03.2025 For The A.Y.2022-23 Emanating From The Assessment Order Under Section 143(3) Of The Income Tax Act, 1961, Dated 05.03.2024. The Assessee Has Raised The Following Grounds Of Appeal :

Section 133(6)Section 139(1)Section 143(3)Section 250Section 54FSection 54F(4)

Avanasiyappan Eswaran, Tiruppur vs. ITO, Ward 1(2), Tiruppur

In the result, the appeal filed by the assessee is allowed for statistical purposes

ITA 1666/CHNY/2025[2016-17]Status: DisposedITAT Chennai08 Sept 2025AY 2016-17

Bench: Shri George George K & Shri S.R. Raghunatha

For Appellant: Shri S. Ramachandran, CAFor Respondent: Ms. Gouthami Manivasagam, JCIT
Section 139(1)Section 143(2)Section 143(3)Section 250Section 50CSection 54FSection 54F(4)

Mohan Ramchandani, Banglore vs. ACIT-Intl Tax-2 Ahemdabad, Ahmedabad Gujarat

In the result, the appeal filed by the assessee is allowed for statistical purposes

ITA 1944/AHD/2024[2016-17]Status: DisposedITAT Ahmedabad17 Jul 2025AY 2016-17

Bench: Shri Siddhartha Nautiyal & Shri Makarand V.Mahadeokarasstt.Year : 2016-17 Mohan Ramchandani Acit-Intl Tax-2 Flat-11001 Boddaballapur Road Vs. Ahmedabad. Presting Monte Carlo Yelahanka Satelite Town So Bangalore North. Pan : Adgpr 0211 D (Applicant) (Responent) : Shri Saurabh Gupta, Ar Assessee By : Shri Saresh Kartik Laxmanbhai, Sr.Dr Revenue By सुनवाई क" तारीख/Date Of Hearing : 16/07/2025 घोषणा क" तारीख /Date Of Pronouncement: 17/07/2025 आदेश आदेश/O R D E R आदेश आदेश

For Appellant: Shri Saresh Kartik Laxmanbhai, Sr.DR
Section 139(1)Section 143(3)Section 54ESection 54FSection 54F(4)

Sreenivasulu Sagaleti, Bengaluru vs. Income Tax Officer, Ward-2(2)(2), Bengaluru

In the result, appeal filed by the assessee is allowed

ITA 2493/BANG/2024[2018-19]Status: DisposedITAT Bangalore16 May 2025AY 2018-19

Bench: Shri. Laxmi Prasad Sahuandshri.Keshav Dubeyassessment Year :2018-19

For Appellant: Shri. Sandeep Chalapathy, CAFor Respondent: Shri. Ganesh R Gale, Standing Counsel for Department
Section 139Section 139(1)Section 54FSection 54F(1)Section 54F(4)

Smt. Sita Khandelwal, Bareilly vs. Assistant Commissioner of Income Tax, Circle-2, Bareilly

In the result, the appeal of the assessee stands dismissed

ITA 687/LKW/2019[2015-16]Status: DisposedITAT Lucknow03 Jan 2025AY 2015-16

Bench: Shri Anadee Nath Misshra & Shri Subhash Malguria

Section 139Section 139(1)Section 139(4)Section 143(3)Section 54Section 54(2)Section 54F

Alok Kumar Chamria (HUF), Kolkata vs. I.T.O., Ward - 32(3), Kolkata

The appeal of the assessee is allowed

ITA 1487/KOL/2024[2017-2018]Status: DisposedITAT Kolkata29 Nov 2024AY 2017-2018

Bench: Shri Sonjoy Sarma & Shri Rajesh Kumari.T.A. No.1487/Kol/2024 Assessment Year: 2017-18 Alok Kumar Chamria (Huf)…………........………………....Appellant 25E Chamria House, Shakespeare Sarani, 3Rd Floor, W.B. – 700017. [Pan: Aafha4854F] Vs. Ito, Ward-32(3), Kolkata.….……….…............................…..…..... Respondent Appearances By: Mrs. Saswati Mitra (Dutta), Advocate, Appeared On Behalf Of The Assessee. Shri Pradip Kr. Biswas, Addl. Cit, Appeared On Behalf Of The Revenue. Date Of Concluding The Hearing : November 19, 2024 Date Of Pronouncing The Order : November 29, 2024 आदेश / Order Per Sonjoy Sarma: The Present Appeal Has Been Preferred By The Assessee Against The Order Dated 29.04.2024 Of The National Faceless Appeal Centre [Hereinafter Referred To As ‘Cit(A)’] Passed U/S 250 Of The Income Tax Act (Hereinafter Referred To As The ‘Act’). 2. The Brief Facts Of The Case Are That The Assessee Filed Its Return Of Income On 03.08.2017 By Declaring A Total Income Of Rs.12,14,280/-. The Return Was Processed U/S 143(1) Of The Act & Refund Of Rs.26,980/- Was Issued. Subsequently, The Case Was Selected For Scrutiny & Notices U/S 143(2) & 142(1) Of The Act Were Issued Requiring The Assessee To Furnish Specific Details. The Assessee Submitted Responses & Uploaded Documents Periodically. During The Scrutiny Proceedings, The Assessing Officer Observed That The Assessee Had Declared Long-Term Capital Gain (‘Ltcg’) From The Sale Of Immovable Property. The Assessing Officer Noted That Sale Consideration For Seven Flats As Per Sale Deed Was Lower Than The Stamp Duty Value. He Invoked

Section 143(1)Section 143(2)Section 250Section 50CSection 54FSection 54F(4)

Jesudason Biji, Chennai vs. Office of Income Tax Officer Int. Taxn Ward1(1), Chennai

In the result, appeal filed by the assessee is allowed

ITA 567/CHNY/2024[2014-15]Status: DisposedITAT Chennai30 May 2024AY 2014-15

Bench: Shri Aby T. Varkey & Shri S.R.Raghunatha

For Appellant: Shri M.V.Swaroop, AdvocateFor Respondent: Shri D. Hema Bhupal, JCIT
Section 119(2)(b)Section 139(1)Section 139(5)Section 147Section 148Section 148ASection 149Section 54ESection 54F

Sathi Trinatha Reddy, East Godavari Dist vs. Principal Commissioner of Income Tax(Central), Visakhapatnam

In the result, appeal of the assessee is allowed

ITA 8/VIZ/2023[2013-14]Status: DisposedITAT Visakhapatnam31 Mar 2023AY 2013-14

Bench: Shri Duvvuru Rl Reddy, Hon’Ble & Shri S Balakrishnan, Hon’Ble

For Appellant: Sri MV Prasad, CAFor Respondent: Sri MN Murthy Naik, CIT-DR
Section 132Section 139(1)Section 142(1)Section 143(3)Section 153ASection 263Section 54FSection 54F(1)Section 54F(4)

Sri. Ramaiah Dorairaj, Bengalore vs. Income Tax Officer, Ward-4(2)(2), Bengaluru

In the result, the appeal of the assessee is partly allowed for statistical purposes

ITA 1899/BANG/2018[2013-14]Status: DisposedITAT Bangalore09 Dec 2020AY 2013-14

Bench: Shri N.V. Vasudevan & Shri Chandra Poojarishri Ramaiah Dorairaj, No.2186, Bmkaval, Hal 3Rd Stage, Bangalore-560 075 ….Appellant Pan Abrpd 2580L Vs. Income Tax Officer, Ward 4(2)(2), Bangalore. ……Respondent. Assessee By: Shri S.V. Ravi Shankar, Advocate. Revenue By: Shri Priyadrshi Mishra, Jcit (D.R)

For Appellant: Shri S.V. Ravi Shankar, AdvocateFor Respondent: Shri Priyadrshi Mishra, JCIT (D.R)
Section 54FSection 54F(1)Section 54F(4)

Shri. Praveen Kumar, Bengaluru vs. Assistant Commissioner of Income-Tax, Circle-3(2)(1), Bengaluru

In the result, appeal of the assessee is allowed

ITA 3344/BANG/2018[2013-14]Status: DisposedITAT Bangalore29 May 2020AY 2013-14

Bench: Shri A. K. Garodia & Shri Pavan Kumar Gadaleassessment Year : 2013-14 Shri. Praveen Kumar, The Assistant Commissioner Of No.222, K. H. Ranganatha Colony Income Tax, Main Road, Vs. Circle – 3(2)(1), Opp Bhel Mysore Road, Bengaluru. Bengaluru – 560 040. Pan : Addpk 6151 G Appellant Respondent Assessee By : Shri. Lokesh Jain, Ca Revenue By : Shri. A. Ramesh Kumar, Jcit (Dr)(Itat), Bengaluru Date Of Hearing : 03.03.2020 Date Of Pronouncement : 29.05.2020 O R D E R Per A.K. Garodiathis Appeal Is Filed By The Assessee & The Same Is Directed Against The Order Of Learned Cit(A)-3, Bengaluru, Dated 29.10.2018, For Assessment Year 2013-14. The Grounds Raised By The Assessee Are As Under:

For Appellant: Shri. Lokesh Jain, CAFor Respondent: Shri. A. Ramesh Kumar, JCIT (DR)(ITAT), Bengaluru
Section 234BSection 263Section 54Section 54FSection 54F(4)

Sobha Divyang Joshi, Ahmedabad vs. The Income Tax Officer, Ward-5(2)(3), Ahmedabad

In the result, the appeal of the assessee is allowed

ITA 745/AHD/2016[2010-11]Status: DisposedITAT Ahmedabad03 Feb 2020AY 2010-11

Bench: Shri Rajpal Yadavassessment Year : 2010-11 Sobha Divyang Joshi, Vs. Income Tax Officer, 55, Prathna Vihar Society, Ward 5(2)(3), B/H Manekbaug, Ambawadi, Ahmedabad Ahmedabad – 380 006 [Pan : Agxpj 9869 R] अपीलाथ"/ (Appellant) "" यथ"/ (Respondent) Assessee By : Shri M K Patel, Ar Revenue By : Shri Deelip Kumar, Sr Dr सुनवाई क" तार"ख/Date Of Hearing : 29/01/2020 घोषणा क" तार"ख /Date Of Pronouncement: 03/02/2020

For Appellant: Shri M K Patel, ARFor Respondent: Shri Deelip Kumar, Sr DR
Section 139(1)Section 148Section 54FSection 54F(1)Section 54F(4)

Sri Sudheer Valsala Sreekumaran, Bangalore vs. The Income Tax Officer Ward-5(3)(2), Bangalore

In the result, the appeal of the assessee is treated as allowed

ITA 393/BANG/2019[2013-14]Status: DisposedITAT Bangalore20 Dec 2019AY 2013-14

Bench: Shri B.R Baskaran & Shri Pavan Kumar Gadaleassessment Year : 2013-14

For Appellant: Shri V Srinivasan, AdvocateFor Respondent: Smt. R Premi, JCIT (DR)
Section 139(1)Section 139(4)Section 54ESection 54FSection 54F(4)

Mrs. Kamal Murlidhar Mokashi, Pune vs. Income-Tax Officer

In the result, the appeal of the assessee is allowed

ITA 939/PUN/2016[2011-12]Status: DisposedITAT Pune19 Aug 2019AY 2011-12

Bench: Shri Anil Chaturvedi, Am & Shri Vikas Awasthy, Jm आयकर अपील सं. / Ita No.939/Pun/2016 "नधा"रण वष" / Assessment Year : 2011-12 ………. अपीलाथ" / Mrs. Kamal Murlidhar Mokashi, At & Post Moshi Taluka, Appellant Haveli District, Pune – 412105. Pan : Dbypm5370H. बनाम V/S ………. ""यथ" / The Income Tax Officer, Ward-8(3), Pune. Respondent Assessee By : Shri Sanket Joshi. Revenue By : Shri Rajesh Gawali.

For Appellant: Shri Sanket JoshiFor Respondent: Shri Rajesh Gawali
Section 139(1)Section 143(1)Section 143(3)Section 148Section 54Section 54FSection 54F(4)

Shri Nandkishore Ramanlal Parikh HUF, Ahmedabad vs. The Income Tax Officer, Ward-5(2)(3), Ahmedabad

In the result, appeal of the assessee is allowed

ITA 490/AHD/2017[2013-14]Status: DisposedITAT Ahmedabad30 Apr 2019AY 2013-14

Bench: Shri Rajpal Yadavआयकर अपील सं./ Ita No. 490/Ahd/2017 "नधा"रण वष"/Assessment Year: 2013-14 Nandkishore Ramanlal Parikh- Ito, Ward-5(2)(3) Huf Vs Ahmedabad. Chitrakut F.P.390 Bh. Shakuntal Complex C.N.Vidyalay Road Ambawadi, Ellisbridge Amedabad 380 006. Pan : Aaghn 0923 H अपीलाथ"/ (Appellant) "" यथ"/ (Respondent) Assessee By : Arti N. Shah, Ar Revenue By : Lalit P. Jain, Sr.Dr

For Appellant: Arti N. Shah, ARFor Respondent: Lalit P. Jain, Sr.DR
Section 139(1)Section 143(2)Section 54Section 54FSection 54F(1)Section 54F(4)