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3. Succinctly, the factual matrix of the case is that the assessee transferred certain plot of land (being, original asset) on 11-06-2012 which resulted into long term capital gain of Rs.97,46,504/-. The assessee claimed exemption u/s.54F of the Act for a sum of Rs.87,73,454/- on proportionate basis towards investment of Rs.1,12,92,650/- on purchase of plot and construction of a new residential house thereon. The Assessing Officer (AO) observed that exemption u/s.54F of the Act was claimed, inter alia, on the total cost of plot amounting to Rs.44,14,840/-. Taking note of the prescription of section 54F, granting exemption on construction of a new residential house within a period of three years from the date of transfer of original asset, the AO held that such purchase of land by the assessee for Rs.44,14,840/-, made prior to the date of the transfer of original asset, could not be considered as qualifying amount. Allowing exemption u/s.54F on the cost of construction incurred by the assessee to the tune of Rs.67,59,973/-, the AO rejected the claim of the assessee for exemption qua purchase of total plot amounting Sohanlal M. Bhandari to Rs.44,14,940/-. In holding so, the AO relied on Circular No.667 issued by the CBDT on 18-10-1993. The ld. CIT(A) held that the part of common plot of land purchased by the assessee within one year before the date of transfer of the original asset qualified for exemption u/s.54F. Investment in the part of the common plot made before one year from the date of transfer of the original asset was held to be not eligible for exemption, against which the assessee has come up in appeal before the Tribunal. The factum of filing of any cross appeal by the Revenue has not been brought to our notice by the ld. DR.

4. We have heard both the sides and gone through the relevant material on record. The undisputed position is that the assessee transferred the original asset on 11-06-2012 and purchased a common plot of land for construction of a new residential house thereon, in the following different parts, which for convenience, can be divided into two parts, viz., the first part of the plot purchased on 11.10.2010 and the second part of the plot purchased in the year 2011/12 : 

                  11-10-2010         Rs.34,83,440/-
                  04-11-2011             Rs.73,00/-
                  04-11-2011          Rs.2,82,500/-


                                                           Sohanlal M. Bhandari



                   04-11-2011            Rs.2,82,500/-
                   04-11-2011               Rs.7,300/-
                   11-11-2011            Rs.2,82,500/-
                   11-11-2011               Rs.7,300/-
                   25-01-2012              Rs.62,000/-
                      Total             Rs.44,14,840/-

5. In addition, the assessee incurred cost of construction amounting to Rs.67,59,973/- on the above common plot for a new residential house, which component has been held by the AO as eligible for exemption. The dispute is only qua the cost of common plot purchased by the assessee for constructing the new house. Whereas, the AO held the assessee to be not eligible for exemption in respect of the entire purchase cost of plot at Rs.44,14,840/-, the ld. CIT(A) restricted the disallowance only to purchase of the first part of plot of land on 11.10.2010 for Rs.34,83,440/-, which is beyond a period of one year before the date of transfer of the original asset. It is not disputed that all other relevant conditions contained in section 54F of the Act stand duly complied with. The neat controversy which, therefore, crystalises is whether the assessee is entitled to exemption u/s 54F of the Act qua the first part of the plot of land purchased for constructing a new residential house, before one year from the date of transfer of the original asset. In order to answer the issue at hand, it would be Sohanlal M. Bhandari apposite to consider relevant parts of provision of section 54F, as under :-