FATHIMA BAI Vs. ITO

JUDGEMENT

(1.) THE appellant/assessee sold an immovable house property in the assessment year 1988 -89 for a consideration of Rs. 10,00,000 by a registered sale deed dated 27 -7 -1987. The assessee entered into an agreement for purchase of an urban house property for a sum of Rs. 8,50,000 and had paid Rs. 3,50,000 in the assessment year 1988 -89. The assessee purchased the said property by a registered sale deed on 15 -12 -1988 by paying a balance of Rs. 5,00,000. The assessee had to file returns by 30 -7 -1988.

(2.) THE assessing officer issued notice to the assessee under section 148 of the Income Tax Act. The assessee on 27 -2 -2000 filed the returns declaring the income as nil for tax purpose.

(3.) THE assessing officer held that the unutilised sale price of Rs. 5,00,000 is not invested as required under section 54(2) of the Income Tax Act. Therefore, the assessee is not entitled to exemption and that the assessee is liable to pay capital gain tax of Rs. 5,00,000. The Commissioner (Appeals) in appeal upheld the order of the assessing officer The Tribunal also upheld the order of the assessing officer. The assessee is in appeal.