Investment u/s 54 f

This query is : Resolved

Shankar Rao (Querist)
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20 December 2011 Dear all
My freind has made a deposit in capital gain deposit scheme u/s 54F for a period of one year ( in the FD receipt it is clearely mentioned as " Deposited under capital gain scheme") and was renewed for further period of 2 years with out crediting to any account. Now the case selected for scrutiny and the A O is not conisering this deposit for deduction u/s 54F as the same was not deposited for a period of 3 years at the begining.
whether the A O is justified or is there any alternative available to my friend.
kindly let me know.

With regards

CA CS PRASHANT

CA CS PRASHANT (Expert)
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20 December 2011 A nice case law.

The decision of AO can be challanged on the basis of renewal copy.

The renewal should be done well before the date of expiry of one year deposit plan/.

That means there should not be any gap between the expiry and renewal.

There is nothing mentioned in s.54F that deposit should be made at a time for three years..i.e it may be renewed.