Exemption u/s 54

This query is : Resolved

Querist : Anonymous

Querist : Anonymous (Querist)

23 March 2014 The Assessee has income from long term capital gains to the tune of Rs.70 lakhs from sale of residential property. date of sale may 2010. Further out of the sale proceeds, He invested in purchase of Bonds & debentures and earned short term capital gains and subsequently he redeemed all his short term investments and invested in purchase of Long term capital asset ie., purchase of residential property and claimed the exemption u/s 54 being completed the transaction before the due date of furnishing the returns. ie., 31-07-2011. Now the case got selected for scrutiny. The assessing officer states , since the assessee has invested in short term capital asset after he got the sale proceeds,, exemption u/s 54 cannot be entertained although he has invested in purchase of residential property subsequently before the due date of filing returns. Whether the A.O. justified in denying the exemption u/s 54 merely because the assessee invested in short term capital asset and subsequently in longterm capital asset without assigning any other reason or any supportive case law. please advise and any case law to support this case.

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Nikhil Kaushik

Nikhil Kaushik (Expert)
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23 March 2014 see if this case law helps you...please note that facts may not squarely apply...you need to create persuasive arguments for application of other cases laws to the facts of your case

V. Krishna Rao V/s. Deputy Commissioner of Income-tax, Circle 3(3), Hyderabad IT APPEAL NOs. 1866 & 1867 (HYD.) OF 2011 [ASSESSMENT YEAR 2008-09]

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Querist : Anonymous

Querist : Anonymous (Querist)

23 March 2014 THANKS FOR SHARING THE CASE LAW. IT WILL BE REALLY USEFUL AND BRILLIANT.

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