Exemption u/s 54F of Income Tax Act not allowable for 500 sqm Shed on Agricultural Land: ITAT [Read Order]

The Delhi Bench of ITAT rejected a claim under Section 54F of the Income Tax Act, where the assessee sought exemption for reinvesting proceeds from the sale of agricultural land into a new residential property. \r

The Assessing Officer treated the transaction as an adventure in the nature of trade due to the high cost per square foot of the land purchased earlier. Despite claiming reinvestment in a jointly purchased property, registry documents only indicated a 500 sq ft "covered area," not confirming it as a residential house.\r

An inspection found a concrete block manufacturing unit on the land, conflicting with residential use. ITAT upheld the denial, stating the evidence didn't support the property being a residential house as per Section 54F requirements.