S. 54F Exemption cannot Be Denied for Non-Deposit in Capital Gain Account if Entire Sale Consideration already Invested in Plot: ITAT

The Income Tax Appellate Tribunal (ITAT) has ruled that the capital gains exemption under Section 54F of the Income Tax Act cannot be denied to an assessee solely because the funds were not deposited in a capital gain account scheme. The assessee had sold a property and invested the entire sale consideration in a new plot of land. The AO had denied the exemption, arguing that the unutilized amount should have been deposited in the specified account. The ITAT, however, held that since the entire sale consideration was already invested in a new asset, the purpose of the section, which is to encourage investment, was met.