Section 54EC Time Limit For Investment: ITAT Takes Liberal View

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From: editor@itatonline.org <itatonline.org@gmail.com>
Date: Tue, May 15, 2012 at 10:07 AM
Subject: Message from EGroup of SolapurCAs S. 54EC Time Limit For Investment: ITAT Takes Liberal View
To: editor@itatonline.org

 

Dear Subscriber,

 

The following important judgement is available for download at itatonline.org.

Mahesh Nemichandra Ganeshwade vs. ITO (ITAT Pune)

S. 54EC: If investment within 6 months of transfer is impossible, then relief available if investment made within 6 months of receipt of consideration

 

The assessee entered into a development agreement on 12.7.2005 in which the consideration was fixed at Rs 2.50 crores. A correction deed was entered into on 2.7.2007 in which the sale consideration was increased to Rs. 4.90 crores. The assessee invested Rs. 50 lakhs in s. 54EC bonds on 3.8.2007 and 27.10.2007. The AO held that the date of transfer was 12.7.2005 and as the s. 54EC investments had been made beyond a period of 6 months from the date of transfer, the exemption was not available. The assessee claimed that as it was impossible for him to invest within 6 months from the date of transfer, the period of 6 months had to be reckoned from the date of receipt of consideration. HELD by the Tribunal:

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Regards,

Editor,

itatonline.org

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