1
Ms Manju D Jethwani
ITA No.3356/M/2012
CO 115/Mum/2013
""
IN THE INCOME TAX APPELLATE TRIBUNAL
MUMBAI BENCH "B", MUMBAI
.. ,
,
BEFORE SHRI G S PANNU, ACCOUNTANT MEMBER
AND SHRI AMIT SHUKLA, JUDICIAL MEMBERITA
ITA No. : 3356/Mum/2012
(Assessment year: 2008-09)
Income Tax Officer -19(1)(1), Vs Ms Manju D Jethwani,
Room No. 319, Piramal Chambers, 501, Moru Milap Building,
Parel, 15th Road, Khar (West),
Mumbai -400 012 Mumbai -400 052
.:PAN: ABRPM 4292 N
(Appellant) (Respondent)
Appellant by : Shri Yogesh Kamat
Respondent by : Shri Bhpendra Shah
CO 116/Mum/2013
Arising out of ITA No. : 3356/Mum/2012, AY 2008-09
Ms Manju D Jethwani, Vs Income Tax Officer -19(1)(1),
Mumbai -400 052 Mumbai -400 012
(Appellant)Cross Objector (Respondent)
Appellant Cross Objector by : Shri Bhpendra Shah
Respondent by : Shri Yogesh Kamat
/Date of Hearing : 14-05-2015
/Date of Pronouncement : 08-07-2015
ORDER
PER AMIT SHUKLA, J.M.:
The aforesaid appeal and Cross Objection has been filed by
the Revenue and the assessee against impugned order dated
22.02.2012 passed by CIT(A)-30, Mumbai for the quantum of
assessment passed u/s 143(3) for the assessment year 2008-09.
The Revenue in the grounds of appeal has raised following
grounds:
1. On the facts and circumstances of the case and in law, the
Ld. CIT(A) has erred in directing to allow the exemption u/s
54 of the IT Act claimed by the assessee for two flats
ignoring the facts that the assessee has purchased two
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Ms Manju D Jethwani
ITA No.3356/M/2012
CO 115/Mum/2013
different residential units vide separate agreements which
were registered separately and as such violated the
conditions specified under provision of section 54(1) of the
Act which provides for deductions in respect of one
residential house.
2. On the facts and in the circumstances of the case and in
law the Ld. CIT(A) has erred in deleting the disallowance
u/s 54 of the I.T. Act after relying on the decision of ITAT,
Mumbai Bench in the case of Sushila M Jhaveri (107 ITD
321) which has not been accepted by the Department.".
2. The main controversy involved is whether the exemption u/s
54 is available to the assessee when she had invested the long-
term-capital-gain in purchasing of two adjoining flats having one
passage and common kitchen. The AO has restricted the claim of
exemption u/s 54 at Rs. 1,36,33,100/- in respect of one flat, as
against claim of Rs. 2,45,96,000/- claimed by the assessee for the
two flats, which were joined together having common passage and
kitchen.
3. At the Appellate stage, the matter was remanded to the AO
for making a spot enquiry to verify the claim of the assessee
whether the two adjoining flats are being used as one unit or not.
The AO vide letter dated 23.01.2012 submitted the following
report:
"As per your honour's direction, I had appointed ward
Inspector, Smt. Bindu Sajiven to make enquiry of the
flats bearing No. 601 and 602, Gitanjali Building, Khar
(W), Mumbai 52 along with stilt car parking No. 4 & 5 in
the case of above said assessee and ward Inspector,
Smt. Bindu Sajiven has submitted report vide dated
11.01.2012 stating that flat is a single unit with one
entrance, one kitchen, four bedrooms, one puja room,
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Ms Manju D Jethwani
ITA No.3356/M/2012
CO 115/Mum/2013
one hall and one servants room with attached bathroom
along with stilt parking Nos. 4 & 5 and as per
Inspector's report the said flats should be treated as
single unit. The Inspector's report has already been
forwarded vide this office letter dated 19.01.2012".
Thus, on the basis of the remand report, the CIT(A) observed that
the two flats have been treated as a single unit by the assessee and
as per the enquiry of the AO done through ITI. Thereafter, the Ld.
CIT(A) referred and relied upon the decision of ITAT, Special Bench
in the case of ITO vs Sushila M Jhaveri reported in 107 ITD 32 and
directed the AO to grant exemption u/s 54 for both the flats.
4. Before us, the Ld. Counsel of the assessee relied upon the
decision of Hon'ble Karnataka High Court in the case of CIT vs
Smt. K G Rukminimma reported in [2011] 331 ITR 021 and catena
of other decisions of the Tribunal whereas, the Ld. DR, strongly
relied upon order of the AO.
5. After considering the rival submissions and on perusal of the
impugned order, we find that it is not in dispute that the assessee
had purchased two adjoining flats, which has been treated as a
single unit having four bedrooms, one common entrance and one
common kitchen. This has been reported by the ITI before the AO,
who has admitted in the remand report dated 23.01.2012. The
Hon'ble Karnataka High Court in the case of CIT vs. Ananda
Basappa reported in [2009] 223 CTR (KR 186) and later on the
decision of CIT vs Smt. K G Rukminimma (supra) has held that the
phrase "residential house in section 54" cannot be construed as a
"singular". In that case, four residential flats joined together were
held to construe a residential house. The relevant observation of
the Hon'ble High Court is as under:
The context in which the expression 'a residential house' is
used in s. 54 makes it clear that it was not the intention of the
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Ms Manju D Jethwani
ITA No.3356/M/2012
CO 115/Mum/2013
legislation to convey the meaning that it refers to a single
residential house. If that was the intention, they would have
used the word "one". As in the earlier part, the words used are
buildings or lands which are plural in number and that is
referred to as "a residential house", the original asset. An
asset newly acquired after the sale of the original asset also
can be buildings or lands appurtenant thereto, which also
should be "a residential house". Therefore the letter 'a' in the
context it/s used should not be construed as meaning
"singular". But, being an indefinite article, the said express/el
should be read in consonance with the other words 'buildings'
and 'lands' and, therefore, the singular 'a residential house'
also permits use of plural by virtue of s. 13(2) of the General
Clauses Act.--CIT vs. D. Ananda Basappa (2009) 223 CTR
(Kar) 186
6. Similarly, in various other decisions of the Co-ordinate
Benches of the ITAT, this principle has been consistently accepted.
Therefore, we do not find any reason to deviate from the conclusion
drawn by the CIT(A) that exemption u/s 54 should be granted to
the assessee for both the flats being Flat 601 and 602 as they have
been joined together and treated as a single unit with common
entrance and one kitchen.
7. Accordingly the Revenue's appeal is treated as dismissed.
8. In the Cross Objection, the assessee has raised following
grounds:
"The Ld. CIT(A) erred in not allowing the deduction of
sum of Rs. 2,50,000/- being paid for brokerage on
account of acquiring new property"
9. The assessee has claimed a payment of Rs. 2,50,000/- from
the broker as brokerage on account of acquiring new property.
Both the authorities have given categorical finding that the
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Ms Manju D Jethwani
ITA No.3356/M/2012
CO 115/Mum/2013
assessee could not furnish any evidence of payment of brokerage
and even before us no such document or evidence have been filed
to rebut such a finding of fact. Accordingly, the claim as well as the
ground raised in the Cross Objection is dismissed.
10. In the result, the appeal of the Revenue as well as Cross
Objection of the assessee are dismissed.
Order pronounced in the open court on 8th July, 2015.
Sd/- Sd/-
(.. )
( )
(G S PANNU) (AMIT SHUKLA)
ACCOUNTANT MEMBER JUDICIAL MEMBER
Mumbai, Date: 8th July, 2015
/Copy to:-
1) /The Appellant.
2) /The Respondent.
3) The CIT(A) -30, Mumbai
4) The CITCity -19, Mumbai.
5) """, , /
The D.R. "B" Bench, Mumbai.
6)
Copy to Guard File.
/By Order
/ / True Copy / /
/
,
Dy./Asstt. Registrar
I.T.A.T., Mumbai
* ..
*Chavan, Sr.PS
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