Non-construction of house within 3 years results disallowance of exemption u/s 54F and not postpone of tax liability

0 comments Tuesday, January 1, 2013

  •  The assessee had sold a property during the year and capital gain was worked out.
  •  The assessee invested that sum in purchasing a plot on which residential house was to be constructed.
  •  The assessee claimed proportionate deduction under section 54F.
  •  However, the house could not be constructed.
  •  The Assessing Officer disallowed the deduction claimed under section 54F by the assessee as no construction had taken place within specified time.
  •  On appeal, the Commissioner (Appeals) upheld order of the Assessing Officer observing that the assessee had not started the work of construction on the said plot, therefore, the claim of deduction under section 54F was not acceptable.
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