In Amit Kumar Banzal v. ITO, the ITAT Raipur held that the benefit of Section 54F of the Income Tax Act can be given to the assessee if he omitted to claim it in the returns and later, produces the details of exemption claim during the course of assessment proceedings.
The assessee, in the instant case, was aggrieved by the orders of the AO and the first appellate authority who denied deduction under section 54F of the Income Tax Act claimed by him out of long term capital gain on sale of land. The denial was mainly on ground that assessee has not shown either capital gain or exemption in his computation of income.
On appeal, the assessee relied on the Apex Court decision in the case of Goetze (India) Ltd vs CIT, wherein it was held that the deduction not claimed in the return of income cannot be allowed by the Assessing Officer but does not impinge upon the power of the appellate authority. Assesee further relied on the CBDT Circular No.014(XL)-35) dated 11.4.1955 in support of their claim.
After considering the rival submissions the bench observed that if during the course of assessment proceedings, the assessee filed details of claim of exemption of the same u/s.54F of the Act, the Assessing Officer is duty bound to entertain those details and verify the same and if the assessee is found eligible otherwise as per the conditions u/s.54F of the Act, he is bound to allow deduction to the assessee. Our view finds support from the circular of CBDT No.014(XL)-35) dated 11.4.1955.
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