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HIGH COURT OF KERALA

Smt. Asha George

v.

Income-tax Officer, Ward 2(1), Thrissur

IT APPEAL NO. 114 OF 2012

Date of Pronouncement – 16.01.2013

 

Section 54F is intended to encourage construction of or acquisition of residential house with the aid of the proceeds from the transfer of any long term capital asset, which is not a residencial house. The provision contemplates computing the cost of the residential building, but the value of the plot on which the farm house stands and the land appurtenant could also be considered. The tribunal has categorically found that the appellant has not produced material to show that the entire area of 1.92 acres should be considered as land appurtenant to it. It is in such circumstances, the tribunal made an estimation and directed that the value of the plot on which the farm house is located and the land appurtenant be fixed as Rs.2 lakhs. We are unable to accept the contention of the appellant that the value of the entire land must be considered in arriving at the value of the residential building. We find no illegality committed by the tribunal. It is not open to the appellant to invoke Section 54B of the Act in regard to the rest of the land at Koothattukulam. This is for the reason that the appellant has not been able to satisfy the requirements of Section 54B as already noted by us in regard to the land at Ayyanthole. Therefore, at any rate, there can be no basis for invoking Section 54B of the Act for deducting the value of the land purchased at Koothattukulam. Therefore, we reject the contention of the appellant. Accordingly, we answer the substantial question of law Nos. 1 and 3 against the appellant.