Sec 54f of income tax

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This query is : Resolved

Suraj (Querist)

14 December 2013 Sir,a person sold his land and to avail exemption u/s 54f,he planned to purchase a flat.He gave the whole amount to a builder.But after 3 years,the builder returned the whole sum telling that he can't allot him a flat.
the person is genuine.Wheather there is any ground on which he will not be chargable to tax?

CA PARAS BAFNA

CA PARAS BAFNA (Expert)

14 December 2013 Considering the genuineness of the transactions and the facts behind builder's refusal to allot the flat the matter may be decided. The assessee can demand justice if things were not under his control.
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Suraj

Suraj (Querist)

14 December 2013 sir,will that person be chargable to tax ?

Nikhil Kaushik

Nikhil Kaushik (Expert)

14 December 2013 it seems there is no relief for you. you would get covered under 54F(3).

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Suraj

Suraj (Querist)

14 December 2013 sir can we file any petition against that builder claiming recovery of tax that we had to pay along with loss of interest?

Nikhil Kaushik

Nikhil Kaushik (Expert)

14 December 2013 yes. you can. you can claim for damages and loss of interest. that is very much there. You have all the rights to claim damages from the builder.

Also, please refer to CBDT circular No. 471 [F. No. 207/27/85-IT(A-II)], dated 15-10-1986.

The circular also talks about "If there is a failure on the part of the D.D.A. to deliver the possession of the flat after completing the construction, the remedy for the allottee is to file a suit for recovery of possession."

Similar circular for other builders No. 672, dated 16-12-1993.

Though these circulars are on a different issue. they do cover issue of filing suit against the builder.

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Suraj

Suraj (Querist)

14 December 2013 Thank you sir...

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