ACIT Vs. IQBAL JAFAR

JUDGEMENT

(1.) THIS appeal is preferred by the Revenue against the order of the ld. CIT(A) deleting the addition made by the Assessing Officer under section 54F of the Income -tax Act, 1961 (hereinafter called in short "the Act") amounting to Rs. 55,10,506/ - without appreciating the facts brought on record by the Assessing Officer during the course of assessment proceedings.

(2.) THE facts in brief borne out from the record are that the assessee has filed return of income at Rs. 5,18,920/ - showing income from house property, capital gains, remuneration and interest from M/s. Zafar Alam International, a partnership firm, in which the assessee is a partner. During the impugned assessment year, assessee has sold a land at Noida for a total consideration of Rs. 70,99,200/ - and had claimed exemption under section 54F of the Act in respect of long term capital gain arising therefrom amounting to Rs. 55,10,506/ - by investing an amount of Rs. 1,05,41,675/ - in residential house situated at 66B, Peveral Street, Ricarton, Christchurch, New Zealand. Assessment was completed under section 143(3) of the Act by the Assessing Officer having disallowed the exemption claimed under section 54F of the Act only on the ground that the investment in respect of residential property has been made by the assessee outside India.

(3.) THE ld. CIT(A) examined the claim of the assessee in the light of various judicial pronouncements referred to by the assessee and being convinced with it, the ld. CIT(A) has held that the appellant is entitled to benefit of deduction under section 54F of the Act in respect of purchase of residential house outside India, as all other conditions provided in that section have been fully complied with by the assessee. The relevant observations of the ld. CIT(A) with regard to the judgments referred to by the assessee and his finding are extracted hereunder: -