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Section 54

29 October 2012

One of my relatives sold the proprty on 1st february 2012. The consideration recd. was put in normal savings account. Due date of return filling has passed and he has nt deposited amt. In capital gains account scheme.he has never filed returns in his life. Can he save his capital gains tax liability?

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5 Replies

sivadas chettoor (CA) (2644 Points)
Replied 30 October 2012

There is a violation of section 54 since you have not deposited the amount in CGAS which appears to be very much necessary for the claim. But there is a decision which allowed a claim even though there was a delay. So my advice will be to deposit the amount as early as possible. I cannot say for sure whether the decision about which I mentioned is a sound decision in law. Anyway try ur luck.

U may also face difficulties at the time of filing the returns since you will have to give details of the deposit to claim the deduction and obviosly there is a delay.

siva208 @ yahoo.com

CA Manish (Job) (5264 Points)
Replied 30 October 2012

Please refer the below case laws where exemption u/s 54 was allowed even in case of return u/s 1394 (4) i.e belated return:-

1. CIT v/s Rajesh Kumar Jalan (2006) 286 ITR 274 (Gau)

2. Fathima Bai V/s ITO (2009) 32 DTR (Kar) 243.

C.Balaji (Learner) (1867 Points)
Replied 30 October 2012

Dear CA Manish Malu,

I would like to know onething. The above mentioned Case laws are for Belated filing of Return alone(i.e.CG deposited in CG A/C scheme on or before the due date) or Depositing the CG in CG Account after the due date of filing the ROI?