Important Beneficial Order of ITAT Kolkata Section 54E of Income Tax Act – Capital Gains – Exemption
ITAT Kolkata – Full Section 54F Exemption Allowed on Rs.26 crores Gains from Sale of Shares
Important Beneficial Order of ITAT Kolkata Section 54E of the Income Tax Act – Capital Gains – Exemption –
On 13.7.2020 the assessee had sold 36,00,000 shares for Rs.33,77,64,511/- resulting in long term gains tax of Rs.26.77 crores. The assessee claimed Section 54F exemption by investing over Rs.53.86 crores in construction of a new residential property.
AO denied exemption on various grounds – ownership of other properties, commencement of construction before sale, non-utilization of sale proceeds directly and gift of shares by husband’s brother, not spouse.
The assessee spent Rs.53,80,198/- upto 31.3.2021 for construction of her new residential property and the completion certificate was received on 9.6.2022 within three years. Therefore, exemption was claimed.
On 20.12.2021, the assessee filed IT return of Rs.187,69,130/-.AO was of the view that –
ITAT Kolkata HELD that joint ownership or industrial land does not bar Section 54F relief and construction begun before the sale still qualifies if completed within three years – Granting full capital gains exemption to the assessee.
