The Income Tax Appellate Tribunal (ITAT), Jaipur bench consisting of DR. S. Seethalakshmi, Judicial Member, and Rathod Kamlesh Jayantbhai, Accountant Member carried that the husband can avail the Capital Gain Exemption for Investment created in the name of the wife.
The petition was made by the taxpayer with respect to the order of the commissioner of the income tax. The points of the case mentioned that the taxpayer sold the immovable property for Rs.14,75,000/-. The value of which was estimated at Rs.14,79,960/- by the Stamp Duty Authority. Out of sale consideration of Rs 14,75,000/- the taxpayer has made an investment of Rs. 7,48,000/- in the buying of new residential house property in the name of his wife, Smt. Garima Singh.
As per the taxpayer claimed the exemption beneath section 54F of the income tax act. Thus, no capital gain was levied beneath the head long-term capital gain on the above immovable property sale. The assessing officer during finishing the assessment has not permitted the claim of exemption and stated it to the total income of the taxpayer as long term capital gain, specifying that as the taxpayer invested in the immovable property in the name of his wife and the taxpayer and his wife are different persons also separate taxpayer deduction available u/s 54F of the Act, is not permitted to the taxpayer. The AO( Assessing Officer) mentioned that the taxpayer would not furnish her income return while holding income subjected to tax hence, penalty proceedings were also executed with respect to the assessee.
After the order, the taxpayer furnishes an appeal to the commissioner of the income tax. However, the commissioner of the income tax refused the appeal that an assessee made and repeated the decision of the Assessing Officer post to recognize the arguments, the Tribunal ruled that the claim of deduction income tax U/s 54F of the act shall not refuse merely on the basis that the new residential house was bought in the name of his wife when the investment created by the taxpayer from the sale moves of the existing asset and obtained capital gain from the mentioned transactions. The taxpayer (Kaushlendra Singh) was shown by C.P. Chawla and the respondent (Revenue) was represented by Runi Pal.
Can you guide me Arpit in the following scenario:-
I have Rs. xx Lakh LTCG from the sale of a flat A, in 2022-23.
I have also invested Rs. zz Lakh in a new flat C in 2021-22, while I had another flat B in my name at that time, which I sold off later in 2021-22 itself with LTCG of Rs. yy Lakh and invested that in 54 EC bond, and shown it in ITR for 2021-22.
However, flat C registration has been done in my wife’s name. She is a homemaker and without any income, although she has PAN.
TDS was duly deducted and paid/ return filed by me for flat C.
Please tell me if I would be able to get an exemption of the LTCG benefit of Rs. xx Lakh from the sale of flat A while filing ITR for 2022–23.