The Mumbai Bench of Income Tax Appellate Tribunal ( ITAT ) has held that the revisional jurisdiction could not be invoked if the Assessing Officer (AO) had taken a plausible view after making proper inquiry.
The assessment in the hands of the assessee, Prerak Goel for the year under consideration was completed by the Assessing Officer u/s.143(3) of the Act accepting income declared by the assessee. The Principal Commissioner of Income Tax (PCIT) examined the assessment record and noticed that the assessee had claimed exemption under Section 54F of the Income Tax Act 1961 against the long-term capital gain arising on sale of shares and the said claim had been accepted by the Assessing Officer.
The assessee has sold 350 shares of Concord Enviro Systems Pvt. Ltd. and earned long term capital gain. The assessee held a flat along with his mother as co-owner. Theassessee purchased the share of his mother and he claimed the above said purchase as deduction under Section 54F of the Act. PCIT denied deduction under S. 45F of the Act.
G Purushottam Tripuri on behalf of the revenue, submitted that the assessee had claimed to have purchased share of his mother, was a colourable device adopted by the assessee in order to avail deduction u/s 54F of the Act as he had not got the conveyance deed registered till date.
Aurav Bansal on behalf of the assessee, submitted that assessee had furnished all the relevant details and the AO was very much aware of the fact that the conveyance deed had not been registered. He further referred toSureshchandra Agarwal case in which tribunal held that the amended provisions did not provide that the instrument of transfer was necessarily to be registered and no requirement of registration of conveyance deed for the purpose of availing deduction u/s 54F of the Act.
The Mumbai bench of B. R. Baskaran (Accountant Member)& Aby T Varkey (Judicial Member) quashed the revision order and allowed the appeal filed by assessee, referring to the decision rendered by the co-ordinate bench in the case of Sureshchandra Agarwal in which the tribunal had expressed the view that the requirement of registration was not there for construing the meaning of “transfer” u/s 2(47)(v) of the Act.
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