High Court Of Karnataka
M.B. Ramesh vs. Income Tax Officer
Section 54, 260A
Asst. Year 1997-98
D.V. Shylendra Kumar & N. Ananda, JJ.
IT Appeal No. 449 of 2009
4th January, 2010
Counsel Appeared :
S. Parthasarathi, for the Appellant
JUDGMENT
D.v. Shylendra Kumar, J. :
The appellant is an individual assessee and in respect of return of income for the asst. yr. 1997-98 had claimed certain exemptions under s. 54 of the IT Act, 1961 (for short “the Act”) on the premise that the profits earned out of sale of the residential property has been reinvested in a like property and therefore sought to reduce the taxable income to the extent of exemption permitted in terms of s. 54 of the Act. While the assessing authority refused exemption under s. 54 of the Act on a factual verification of the place where the assessee claimed to have had the residential property as the assessing authority found only a mud structure not worthy of the caption “residential house”, the aggrieved assessee appealed to the first appellate authority. The first appellate authority took the view that the property in question had already been demolished and accepted the claim of the assessee that the assessee had in turn sold the property in which the gains had been reinvested by some other person and that person had reinvested for profits etc., and therefore there is no question of denial of benefit under s. 54 of the Act under the head “Capital gains”.
The Revenue went in further appeal to the Tribunal who found that as a matter of fact there was never any structure fitting into the description of “habitable residential house” on the property which had been initially sold by the assessee and therefore allowed the appeal of the Revenue, reversed the finding of the first appellate authority and affirmed the order of the assessing authority. For such verification, the Tribunal relied upon the panchayat records which on verification, the Tribunal found that it did not indicate the structure being in place in respect of the property held and sold by the assessee. Sri Parthasarathi, learned counsel for the appellant-assessee would submit that the Tribunal was not right in taking the view that there was no residential property on the site sold by the assessee in respect of which sale the assessee had claimed the benefit under s. 54 of the Act for the reason that just because the structure was not a permanent one, it cannot be called that it was not a residential house at all; that it was a fact that the assessee had rented out the structure and had been receiving rents and that was proof enough of standing structure on the site in question etc. It is also the submission of Sri Parthasarathi, learned counsel for the appellant that there were two adjacent sites and on one side at least there was a structure put up and to that extent the Tribunal should have extended the benefit under s. 54 of the Act and should not have reversed the finding of the first appellate authority in its entirety. We are unable to appreciate the submission for the simple reason that as to whether there was a structure on both sites or one site or whether there was no structure at all is a finding of fact which we are afraid we cannot disturb in an appeal under s. 260A of the Act. It is for this reason, we are not admitting ibis appeal which is hereby dismissed.
[Citation : 320 ITR 451]
