A division bench of the Rajasthan High Court held that the benefit of Section 54B of the Income Tax Act, 1961 cannot be denied to the assessee merely on the ground that the investment and document registered under spouse name.
Justice K.S. Jhaveri and Justice Vijay Kumar Vyas was hearing an appeal filed by the assessee against the ITAT order wherein the Tribunal upheld the order of the AO who enhanced the income of assessee under the head long term capital gain and denied a deduction under section 54B.
The court had an opinion that in view of the decision of the Delhi High Court in Sunbeam Auto Ltd. and other judgments of different High Courts, the word used was assessee has to invest it is not specified that it is to be in the name of assessee.
Analyzing the relevant provisions of the Act, the division bench further .observed that the legislature while using language has not used specific language.
Finally, the Court held that the contention raised by the assessee was required to be accepted with regard to Section 54B regarding investment in tubewell and others and in their considered opinion, for the purpose of carrying on the agricultural activity, tubewell and other expenses are for betterment of land and therefore, it will be considered a part of investment in the land and same need to be accepted.
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