Ita/5/2006 Of M/S.meera Jacob v. Incometax Officer

IN THE HIGH COURT OF KERALA AT ERNAKULAM PRESENT : THE HONOURABLE MR. JUSTICE C.N.RAMACHANDRAN NAIR & THE HONOURABLE MR. JUSTICE V.K.MOHANAN MONDAY, THE 9TH JUNE 2008 / 19TH JYAISHTA 1930 ITA.No. 5 of 2006() ------------------- ITA/1105/COCH/2004 of I.T.A.TRIBUNAL,COCHIN BENCH .................... APPELLANT -------------------------- MRS.MEERA JACOB, THUNDIYIL HOUSE, MUTTAMBALAM, KOTTAYAM. BY ADV. SRI.JOSEPH MARKOSE (SR.) RESPONDENTS: ------------- INCOME-TAX OFFICER, WARD-3, KOTTAYAM. BY ADV. SRI.GEORGE K. GEORGE, SC FOR IT THIS INCOME TAX APPEAL HAVING BEEN FINALLY HEARD ON 09/06/2008, THE COURT ON THE SAME DAY DELIVERED THE FOLLOWING: C .N. RAMACHANDRAN NAIR &V.K. MOHANAN, JJ. -------------------------------------------- -------------------------------------------- Dated this the 9th day of June, 2008 JUDGMENT Ramachandran Nair,J. Heard senior counsel Sri. Joseph Markos appearing for theappellant and standing counsel appearing for the respondent. Thequestion involved is whether the assessee, in the computation of longterm capital gains, is entitled to deduction under Section 54F of theIncome tax Act in respect of investment in modification/expansion ofan existing residential house. The Tribunal took the stand thatexemption is available only when the investment is in the constructionof a house and not for investment in modification or renovation.Admitted facts are that assessee had a fairly big house to whichassessee made addition of 140 sq. metres of plinth area. However, it isthe conceded position that assessee has not constructed any separateapartment or house. Section 54F does not provide for exemption oninvestment in renovation or modification of an existing house. On the other hand, construction of a house only qualifies for exemption on the investment. Even addition of a floor of a self-contained type to theexisting house would have qualified for exemption. However, since theassessee has only made addition to the plinth area, which is in the formof modification of an existing house, she is not entitled to deductionclaimed under Section 54F of the Act. We therefore uphold the order of the Tribunal and dismiss theappeal. (C.N.RAMACHANDRAN NAIR) Judge. (V. K. MOHANAN) Judge. kk