{"id":792,"date":"2024-01-17T15:43:35","date_gmt":"2024-01-17T15:43:35","guid":{"rendered":"https:\/\/caalokkumar.com\/my-writing\/?p=792"},"modified":"2024-01-24T07:49:19","modified_gmt":"2024-01-24T07:49:19","slug":"property-used-for-religious-purpose-ineligible-for-sec-54f-relief-itat","status":"publish","type":"post","link":"https:\/\/caalokkumar.com\/my-writing\/property-used-for-religious-purpose-ineligible-for-sec-54f-relief-itat\/","title":{"rendered":"Property Used for Religious Purpose Barred from Sec. 54F Relief – ITAT"},"content":{"rendered":"\n

Income Tax Ruling<\/a><\/span><\/strong>: In a case where the assessee sought an exemption under Section 54F for a building they constructed, it was found that the building was primarily used for religious purposes, including a mosque, an orphanage school, and staff quarters. Consequently, this building did not conform to the definition of a ‘residential house’ as envisioned in Section 54F. Therefore, the assessee was not eligible for relief under this section.<\/p>\n\n\n\n

[2024] 158 taxmann.com 377 (Hyderabad – Trib.)<\/a><\/strong>
IN THE ITAT, HYDERABAD BENCH ‘B’
Assistant Commissioner of Income-tax, Circle 6(1)
v.
Iqbal Ali Khan

R.K. PANDA, VICE-PRESIDENT<\/a><\/strong>
AND LALIET KUMAR, JUDICIAL MEMBER
IT APPEAL NO. 505 (HYD.) OF 2020
[ASSESSMENT YEAR: 2013-14]
JANUARY  12, 2024 <\/p><\/blockquote><\/figure>\n\n\n\n

Section 54F of the Income Tax Act, 1961,<\/a> pertains to the exemption of capital gains<\/strong> in cases of investment in residential houses. During the assessment year 2013-14, the assessee sold two properties in the financial year 2012-13 and sought an exemption under Section 54F, claiming to have constructed a residential building within three years. The Assessing Officer observed that the new building comprised a mosque, an orphanage school, and staff quarters. He noted the absence of evidence demonstrating the assessee’s investment in the construction of a residential house. Consequently, he concluded that the assessee was not entitled to relief under Section 54F.<\/p>\n\n\n\n

Inspections by the revenue department revealed that the building was primarily used for religious purposes, such as a mosque, orphanage school, and staff quarters, and therefore did not qualify as a ‘residential house’ as defined in Section 54F. Additionally, the assessee’s report claiming the third floor as residential was contradicted by their statement to the GHMC (Greater Hyderabad Municipal Corporation) for regularization of the property, which stated it was used for a mosque, orphanage school, and staff residence.<\/p>\n\n\n\n

Given these findings, and considering that Section 54F of Income Tax Act 1961<\/a>, does not allow for pro-rata deductions, the assessee was not granted any relief under this section. This decision was made in favor of the revenue department [Paragraph 16].<\/p>\n\n\n\n