Section 54 Relief Denied on the basis of Building Permission Plan Submitted by Assessee: ITAT
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- Last Updated on 18 April, 2023
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Case Details: R. Mohan v. ITO - [2023] 149 taxmann.com 54 (Chennai-Trib.)
Judiciary and Counsel Details
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- Mahavir Singh, Vice President & G. Manjunatha, Accountant Member
- N. Arjunraj, CA & S. Sridhar, Adv. for the Appellant.
- AR. V. Sreenivasan, Addl. CIT for the Respondent.
Facts of the Case
Assessee sold his inherited property and used sale consideration to purchase a residential plot and construct the house. Assessee claimed deduction under section 54 with respect to said purchases.
During the assessment, Assessing Officer (AO) allowed deductions towards re-investment in the purchase of another residential house property. However, he disallowed the amount claimed for the construction of the house property on the ground that the assessee failed to file any evidence to prove the completion of the house construction.
On appeal, the CIT(A) upheld the disallowance made by AO. Aggrieved-assessee filed the instant appeal before the Tribunal.
ITAT Held
The Tribunal held that the assessee had obtained Demolition & Re-construction Permission’ from the Corporation of Chennai on 15-5-2012 and also obtained ‘Building Plan Permission’ on 19-5-2012. However, on the basis of the ‘Building Permission Plan’ so obtained, it cannot be assumed that the assessee has completed the construction of the house property.
The assessee had also filed an ‘Estimate’ for the construction of the residential building and a Valuation Report obtained from the approved Valuer along with photos taken. Still, the fact remains that the Valuation Report obtained from the approved Valuer specified the probable completion date of the house property construction. Further, the photographs alone cannot indicate the completion of the house property.
Therefore, based on said evidence, it cannot be concluded that the assessee satisfied the conditions prescribed under section 54 to allow the benefit.
List of Cases Referred to
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- CIT v. Manjula J. Shah [2011] 16 taxmann.com 42/[2012] 204 Taxman 691/[2013] 355 ITR 474 (Bom.) (para 5).
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