PRAFUL SOMABHAI PATEL Vs. INCOME TAX OFFICER

JUDGEMENT

(1.) By way of these appeals, the appellants -original assessees have challenged the order of the Income Tax Appellate Tribunal, Ahmedabad Bench "C", Ahmedabad ("the Tribunal" for short) dated 30.12.2005 in ITA Nos.1717 -1729 - 1731/Ahd/2009, whereby the Tribunal allowed the appeals of the revenue and reversed the order passed by the CIT (A) by confirming the order of the Assessing Officer, who has taken into account revised assessment pursuant to the audit objections raised in case of all the three assessees, who happens to be co -owners of a property.

(2.) Since the facts are identical in these appeals, we may refer to the facts leading to the filing of Tax Appeal No.1071 of 2006. Return of income was filed on 30th June 1995, declaring an income of Rs.15,48,954/ -, Rs.15,48,310/ - and Rs.15,54,757/ - i.e. respectively for each of the three assessees. The assessment, in each case, was made vide order under Section 143 (3) dated 29th March 1996 at the returned income after allowing the assessee its claim u/s.54 F of the Act. However, subsequently, it was found that the assessee also owned one more property, income from which is chargeable under the head Income from 'House Property', and therefore, the deduction under Section 54F stood wrongly allowed to it. Accordingly, notice under Section 148 of the Act was issued on 17.2.1997, which stood responded, in each case, by the assessee filing its return of income on 23.7.1997 at the income as originally returned.

(3.) In respect of its claim under Section 54F of the Act, it was explained by the assessee that it had released its share in the property being residential house at Shahpur, Ahmedabad on 23.7.1995 and, therefore, it did not own any other residential property as on the date of the transfer of original asset i.e. on the transfer of which the capital gains to it during the relevant previous year arose, or the 'transferred property'. As regards the date of transfer, it was explained that though the stamp paper on which the transfer was executed was purchased on 24th March, 1995, the same was actually executed on 28"' March, 1995. As such, as on that date, the assessee did not own any other residential house so as to disqualify its claim u/s. 54 F. Further, it was also contended by it that its share in the Shahpur Property was limited only to the extent of 1/5th of its total area of 77 sq. mtr., and which considering the parameters that would enable it to be considered as a residential house, were not, met, so as to, without prejudice to its averment of the property having been transferred only on 28th March, 1995, disentitle it for its claim u/s. 54 F.