Claim of Deduction u/s 54F Rejected by AO without Obtaining any Evidence for Proof of Construction done: ITAT Directs Re-adjudication [Read Order]

The Chennai bench of the Income Tax Appellate Tribunal (ITAT) directed the assessing officer to re-adjudicate the rejection of the claim of deduction under section 54F of the Income Tax Act,1961 without obtaining any evidence for proof of construction done by the assessee. 

K.S.Anbuselvan, the appellant assessee appealed against the order passed by the Commissioner of Income Tax (Appeals) for confirming the rejection of the claim of deduction made by the assessing officer. 

S.Sridhar, the counsel for the assessee contended that the assessee could file evidence to prove that the acquisition and construction of the new house property, were completed within the prescribed time limit provided under the Income Tax Act. 

It was further submitted that the assessee was eligible to get the claim of deduction under section 54F of the Income Tax Act which was denied by the assessing officer. 

AR.V.Sreenivasan, the counsel for the revenue relied on the decisions made by the lower authorities and contended that the assessee could not file any evidence to prove the construction of house property within the time prescribed under the provisions of section 54F of the Income Tax Act. 

The bench observed that the deduction towards the indexed cost of acquisition and deduction claimed under section 54F of the Income Tax Act also needs to be re-adjudicated by the Commissioner of Income Tax (Appeals). 

The two-member bench comprises Manjunatha. G (Accountant) and Manomohan (Judicial) directed the assessing officer to re-adjudicate the claim of deduction filed under section 54F of the Income Tax Act while allowing the appeal filed by the assessee. 

To Read the full text of the Order CLICK HERE

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