The Income Tax Appellate Tribunal (ITAT), Jaipur Bench allowed the deduction under section 54F of the Income Tax Act in respect of residential house property purchased in the name of wife.
The assessee, Dharamvir Singh derived income from house property, capital gain, and interest. He filed his return of income declaring a total income of Rs. 1,73,050/-. The assessment was completed under section 143(3) or 147 of the Act by assessing the total income of the assessee at Rs. 17,50,620/-. Being aggrieved by the order of the AO, the assessee carried the matter before the CIT(A). However, the CIT(A) after considering the case of both the parties, sustained the addition made by the AO.
The e assessee has reiterated the arguments as were raised before the lower authorities and submitted that an agreement for sale of industrial plot was executed for a total sale consideration of Rs. 11,25,000/-. However, the entire sale consideration was received through cheque in two installments and the said amount was deposited in the bank account maintained by the assessee and consequently, possession of the property was handed over to the purchaser and in this way, entire transactions were completed.
It was submitted that the registration of the plot in question took place in April, 2011 and at that time the DLC value per Sq.Mt. was increased from Rs. 1500/- to Rs. 2000/- per Sq.Mt., consequently, the AO applied increased DLC value while calculating the sale price of the plot in question.
The ITAT we found that the AO made additions by disallowing improvement cost and making an investment by the assessee in the purchase of a residential house in the name of his wife.
The coram of Sandeep Gosain and Vikram Singh Yadav held that the assessee is eligible for deduction under section 54F of the Act in respect of residential house property purchased in the name of his wife.
While considering the totality of facts and circumstances of the case, the ITAT directed to delete the addition so made.
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