TITLE: Two flats, even though acquired under different agreements
& from different sellers, are one residential unit if there is a common
kitchen
The
department’s argument that the law laid down by the Tribunal in ITO v/s Sushila M. Jhaveri 107 ITD 327
(Mum)(SB) and confirmed by this Court in CIT v/s Raman Kumar Suri (Income Tax
Appeal No.6962 of 2010, decided on 27.11. 2012) on the availability of
exemption u/s 54 is applicable only when the house purchased is a single unit
and not where two flats, one acquired in the assessee’s name and another
jointly in the names of the assessee and his wife but under two distinct
agreements and from different sellers have been taken into consideration is not
acceptable.
Though
these flats were acquired under two distinct agreements and from different
sellers, the map of the general layout plan as well as internal layout plan in
regard to flat Nos.103 and 104 indicate that there is only one common kitchen
for both the flats.
The flats were constructed in such a way
that adjacent units or flats can be combined into one. The admitted fact is
that the flats were converted into one unit and for the purpose of residence of
the assessee.
Thus, though the acquisition of the flats
may have been done independently but eventually they are a single unit and
house for the purpose of residence.
RELATED
JUDGEMENT
·
Hill Properties Ltd vs. Union Bank (Supreme
Court) – “Occupancy rights in flat conferred by Articles of Association confer
ownership rights in flat.”
·
CIT vs. Syed Ali Adil (Andhra Pradesh High
Court) – “The building should be of residential nature and “a” should not be
understood to indicate a singular number.”
