Assessee filed appeal against the order of AO restricting the claim of deduction under section 54F only to one plot of land and construction of house against the claim of cost of acquisition of all the four plots which were merged into one plot of land by the assessee. Held: AO had not disputed a fact that assessee had merged all these four plots into one plot by erecting a boundary wall covering all the four plots and leaving only one entrance gate. The finding of the Tribunal that the property though purchased from two different persons by virtue of four different sale instances in the shape of four different parcels of land, constitutes one single residential unit or house of the assessee was upheld by Smt. Sunita Aggarwal (2006) 284 ITR 20 (Delhi) : 2006 TaxPub(DT) 0942 (Del-HC). Thus, what is relevant is the purchase of land and construction of house, and not how many land parts were purchased by the assessee. Thus, once the land purchased by the assessee vide different sale deeds was merged together to constitute a single plot of land, then construction of the residential house on such land is eligible for deduction under section 54F for the entire investment made in the plot of land as well as construction of house, instead of only part of the said land.
IN THE ITAT, JAIPUR BENCH
RAMESH C. SHARMA, A.M. & VIJAY PAL RAO, J.M.
Rohan Agarwal v. Asstt. CIT
ITA No. 51/Jp/2016
3 January, 2020
In favour of Assessee.
Assessee by: Mahendra Gargieya, Advocate
Department by: K. C. Gupta, Joint Commissioner
Vijay Pal Rao, J.M.
This appeal by the assessee is directed against the Order, dated 4-11-2015 of the learned Commissioner (Appeals), Ajmer for the assessment year 2009-10. Earlier the appeal of the assessee was disposed of by the Tribunal vide Order, dated 13-2-2018, however, subsequently in the Rohan Agarwal v. Asst. CIT (Miscellaneous Application No. 117/Jaipur/2018 vide Order, dated 7-5-2019) the Tribunal has recalled the earlier order for fresh hearing and adjudication of the appeal of the assessee. The relevant findings of the Tribunal in the miscellaneous application Order, dated 7-5-2019 in para 5 are as under :--
'5. Having considered the rival submissions as well as the relevant material on record we note that the assessee has relied upon the various decisions as reiterated in the miscellaneous application. As regards to mistake No. 1 the copies of the decisions relied upon by the assessee are also on record of the appeal file and those decisions have some relevance on the issue of allowing the deduction under section 54F of the Act in respect of more than one plot of land and construction of a house. Since the Tribunal white passing the impugned order has not considered those decisions and the impugned order is completely silent about the decisions relied upon by the assessee. Therefore, in our considered view there is a mistake in the impugned order to the extent of not considering the decisions relied upon by the assessee. So far as the constructed area is concerned we find that the finding of the Tribunal is not based on the constructed area but only for recording the complete facts the per centage of the construction was mentioned in the impugned order. Even the assessing officer as well as the learned Commissioner (Appeals) while allowing the deduction in respect of the cost of one plot of land and construction of house has not taken the percentage of the covered area as ground for disallowance. However since the decisions relied upon by the assessee having relevance on the issue are not considered by the Tribunal, therefore, the said mis take is required to be rectified. Accordingly, the impugned Order, dated 13-2-2018 is recalled and the appeal of the assessee is directed to be listed for fresh hearing and adjudication after consideration of the decisions relied upon by the assessee.'