Kindly answer the following Query:
A & B being co-owners of a residential property sold the same and acquired 2 properties – both properties being owned jointly by the co-owners. (50%-50%) Now, they have claimed in their return of Income – exemption u/s 54 for both the properties – to the extent of 50% in each of the property. So, return of income is showing that one person has claimed exemption in respect of 2 properties – 50% for both the properties - which is against the language used in section 54 – that is – “a residential house” - which is interpreted as one residential house. And hence the claim has not been allowed fully in the scrutiny assessment. Stand of the assessee is that in between them they have claimed exemption for 2 properties – so one can say – one property for one assessee and hence the claim should be allowed. Plz note that those 2 properties are separate ones and can in no case be treated as single as they are sityated at differect locations.
Kindly opine and also quote relevant judgment
Thanking in Advance.
CAclubindia
