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Challa Satish Reddy Huf, Secunderabad vs Dy. Commissioner Of Income Tax , ... on 20 June, 2022
cites
The Commissioner Of Income-Tax, West ... vs M/S. Vegetables Products Ltd on 29 January, 1973
16. Though the learned DR submitted that inasmuch as there is no
reasonable nexus between the object of the provision and the need to
create any classification amongst the assessees deriving long term capital
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ITA No.46/Hyd/2020
gains prior to and after the months of September in any particular year,
the provision cannot be read to have been creating any unreasonable
classification amongst the assessees deriving long term capital gains since
such classification would result in undesired discrimination, the judicial
opinion of the Hon'ble Madras High Court is that there is ambiguity in the
legislative language giving rise to the opinion that the deduction u/s. 54EC
of the Act is not transaction base but assessment year base. Such situation
is covered by the decision of the Hon'ble Apex Court in the case of CIT vs.
Vegetable Products Ltd., [1973] 88 ITR 192 (SC), wherein it was held that If
court finds that language to be ambiguous or capable of more meanings
than one, then the court has to adopt that interpretation which favours
the assessee. We, therefore, while respectfully following the decision of
the Hon'ble Apex Court supra are inclined to allow benefit of the ambiguity
to the assessee. Findings of the Ld. CIT(A) on this aspect are reversed and
the addition made on this count is directed to be deleted.
Sunil Kumar Gupta vs Asst Commissioner Of Income Tax on 27 September, 2016
14. It is the submission of the learned DR that the purpose of Section
54EC of the Act is to allow exemption from tax on long term capital gains,
if invested in bonds, targeted exclusively for creation of infrastructure and
community assets. A plain reading of this section does not give any
indication that this section desires to create any classification between the
assessees, who derive capital gains till the month of September in whose
case, the investment of Rs. 50 Lakhs is possible only once, and the other
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ITA No.46/Hyd/2020
class of assessees, who derive the long term capital gains from the month
of September of any year in whose case, it would be possible for
investment of Rs. 50 Lakhs in two assessment years each. Such a
classification has no nexus with the objects of the provision and, therefore,
the unreasonable discrimination cannot be read into a provision of the Act
so as to violate the principle of equality. While attributing such an act of
discrimination, in violation of the principles of equality, to any statutory
provision, the adjudicatory fora must be slow and reject such an
interpretation. Basing on this analogy, he stresses that the decision of the
Hon'ble Rajastan High Court in the case of Raj Kumar & Sons (supra) has to
be preferred to the decisions of the Hon'ble Madras High Court in
consonance with the constitutionality of the interpretation.
M/S Raj Kumar Jain And Sons (Huf) vs The Commissioner Of Income Tax on 12 January, 2018
15. Having considered the issue in the light of the submission made on
either side, we find that the Ld. CIT(A) is right in his observation that there
is conflict of decisions on this issue between various Hon'ble High Courts.
The decisions of the Hon'ble Madras High Court supra were brought to the
notice of the Ld. CIT(A). Ld. CIT(A), however, referred to the latest decision
on this aspect rendered by the Hon'ble Rajastan High Court in the case of
Shri Raj Kumar Jain & Sons HUF Vs. CIT in ITA No. 157/2012 and observed
that inasmuch as the issue did not attain any finality by way of any
judgment of the Hon'ble Apex Court, he would be justified in following the
latest judgment on this aspect and on that premise, he disallowed the
deduction of Rs. 50 Lakhs claimed to have invested on 30-04-2013.
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