IN INCOME TAX APPELLATE TRIBUNAL, MUMBAI BENCH D , MUMBAI BEFORE SHRI SANJAY GARG, JUDICIAL MEMBER AND SHRI ASHWANI TANEJA, ACCOUNTANT MEMBER ITA No.7183/M/2014 Assessment Year: 2011-12 Office of ITO 24(3)(4), Shri Rupang C Suchde, 702, 7th Floor, C/o Kiran Kanani & Piramal Chambers, Associates, CA, Lalbaug, Vs. 71/A, Rasta Peth, Mumbai - 400012 Opp Israil Church, Narasimha Apartments, Pune 411 011 PAN: BHHPS1959P (Appellant) (Respondent) CO No.84/M/2016 (ITA No.7183/M/2014) Assessment Year: 2011-12 Shri Rupang C Suchde, Office of ITO 24(3)(4), C/o Kiran Kanani & Associates, 702, 7th Floor, Chartered Accountants, Piramal Chambers, 71/A, Rasta Peth, Vs. Lalbaug, Opp Israil Church, Mumbai - 400012 Narasimha Apartments, Pune 411 011 PAN: BHHPS1959P (Appellant) (Respondent) Present for: Assessee by : Shri Ashwin Kashinath, A.R. Revenue by : Shri Vachaspat Tripathi, D.R. Date of Hearing : 04.10.2016 Date of Pronouncement : 19.10.2016 ORDER Per Sanjay Garg, Judicial Member: above titled appeal by Revenue and cross objections by assessee have been preferred against order dated 24.09.2014 of Commissioner of Income Tax (Appeals) [hereinafter referred to as CIT(A)] relevant to assessment year 2011-12. 2 ITA No.7183/M/2014 & CO No.84/M/2016 Shri Rupang C Suchde 2. At outset, Ld. A.R. of assessee has stated at bar that he does not press cross objection filed by assessee. cross objection of assessee is therefore dismissed as not pressed. 3. Now coming to appeal of Revenue. Revenue, in this appeal, has agitated action of Ld. CIT(A) in allowing claim of assessee under section 54 of Act for reinvestment of long term capital gains in house property in Saudi Arabia. At outset, Ld. A.R. of assessee has stated that facts in this case have not been disputed. legal proposition involved in this case is whether assessee is eligible to claim benefit under section 54 of Act on purchase of residential house outside India. He has stated that issue is now squarely covered in favour of assessee by decision of Hon ble Gujarat High Court in case of Leena Jugalkishor Shah vs. ACIT (2016) 72 taxman.com 185 and further by decision of co-ordinate bench of Tribunal in case of ITO vs. Shri Farokh Jal Debbo ITA No.4650/M/2013 vide order dated 05.02.16. Further, he has also relied upon following decisions in this respect: 1. Girdhar Mohanani vs. ITO (ITA No.4591/M/2013) dated 06.05.2010 2. ITO vs. Dr. Girish M. Shah (ITA No.3582/M/2009 dated 17.02.2010 3. N. Ranganathan vs. ITO 33 ITR (Trib) 444 4. Vinay Mishra v. ACIT (141 ITD 301) 5. ACIT vs. Iqbal Jafar 151 ITD 364 4. We have gone through decision of Hon ble Gujarat High Court (supra). Considering identical issue, Hon ble Gujarat High Court while analysing provision of section 54F has observed that there was no condition in section 54F before its amendment by Finance (2) Act, 2004, which came into effect w.e.f. 01.04.15, that sale proceeds arising out of transfer of capital asset should be invested in residential house situated in India. That said amendment brought in section 54F has been made applicable prospectively. Hon ble High Court has further held that even 3 ITA No.7183/M/2014 & CO No.84/M/2016 Shri Rupang C Suchde when language of taxing provision is ambiguous of capable of more meaning than one, then court has to adopt interpretation which favours assessee. Hon ble High Court has further held that section 54F of Act before its amendment was clear that assessee should invest in residential house and that words in India could not be imported into language of section. concluding part of order of Hon ble Gujarat High Court is reproduced as under: 9. We have heard learned counsel for parties. We have perused order of Tribunal. There is no finding recorded by authorities below that appellant-assessee has not invested sale proceeds in residential house. It is also not in dispute that appellant has not purchased residential house in United States of America. In fact, she has purchased residential house in U.S.A. out of capital gain on sale of plot in India and thus she has fulfilled conditions stipulated in section 54F of Income-tax Act. She has invested capital gains in residential house within stipulated time. There was no condition in section 54F of Income-tax Act at relevant time that capital gain arising out of transfer of capital asset should be invested in residential house situated in India. language of section 54F of Income-tax Act before its amendment was that assessee should invest capital gain in residential house. It is only after amendment to section 54F of Income-tax Act by Finance (No. 2) Act, 2014, which came into effect with effect from 1.4.2015 that assessee should invest sale proceeds arising out of sale of capital asset in residential house situated in India within stipulated period. Thus on plain reading of section 54F of Income-tax Act before its amendment by Finance (No. 2) Act leaves no room for any doubt that assessee should restrict her investment within India or outside India. only condition was that assessee should invest in residential house. Tribunal has wrongly interpreted section 54F of Income-tax Act by holding that assessee should purchase residential house situated in India. Prior to amendment to section 54F of Act, only condition stipulated was investment in residential house. When section 54F of Income-tax Act was clear and unambiguous, there is no scope for importing into statute words which are not there. Such importation would be not to construe but to amend statute. If there is any defect in Act, it can be remedied only by legislation and not by judicial interpretation. 10. In present case assessee has purchased residential house in U.S.A. out of sale proceeds of plot in India and thus she has fulfilled conditions of section 54F of Income-tax Act before its amendment by Finance (No. 2) Act. Moreover, when language of taxing provision is ambiguous or capable of more meanings than one, then court has to adopt interpretation which favours assessee. Section 54F of Act before its amendment was clear that assessee should investment in residential house. language of section is clear and unambiguous. Therefore, we cannot import into statute words 'in India' as interpreted by authorities. Thus, taking into consideration above facts, we are of opinion that benefit of section 54F before its amendment can 4 ITA No.7183/M/2014 & CO No.84/M/2016 Shri Rupang C Suchde be extended to residential house purchased outside India. In that view of matter, appeal is allowed. order of Tribunal is set aside. We answer question in favour of assessee and against revenue. 5. similar view has been adopted in following cases of Tribunal: 1. Mumbai Bench in case of Girdhar Mohanani vs. ITO (ITA No.4591/M/2013) dated 06.05.2010 2. Mumbai Bench in case of ITO vs. Dr. Girish M. Shah (ITA No.3582/M/2009 dated 17.02.2010 3. Chennai Bench in case of N. Ranganathan vs. ITO 33 ITR (Trib) 444 4. Bangalore Bench in case of Vinay Mishra v. ACIT (141 ITD 301) 5. Lucknow Bench in case of ACIT vs. Iqbal Jafar 151 ITD 364 6. In light of above decisions of Tribunal, we do not find any infirmity in order of Ld. CIT(A) on this issue. order of Ld. CIT(A) is therefore upheld. 7. In result, cross objections of assessee as well as appeal of Revenue are hereby dismissed. Order pronounced in open court on 19.10.2016. Sd/- Sd/- (Ashwani Taneja) (Sanjay Garg) ACCOUNTANT MEMBER JUDICIAL MEMBER Mumbai, Dated: 19.10.2016. * Kishore, Sr. P.S. Copy to: Appellant Respondent CIT, Concerned, Mumbai CIT (A) Concerned, Mumbai DR Concerned Bench //True Copy// [ By Order Dy/Asstt. Registrar, ITAT, Mumbai. ITO 24(3)(4), Mumbai v. Rupang C Suchde