AKIL KURESHI, J.

1. This Tax Appeal filed by the assessee was admitted for consideration of the following substantial question of law;

“Whether in the facts and circumstances of the case, the Income Tax Appellate Tribunal was right in law in holding that the appellant would not be entitled to benefit of deduction under section 54F of the Income Tax Act, 1961 since the construction of the flats for personal use was completed before the sale of the capital asset ?”

2. The facts, being peculiar, we may notice them at the outset. The appellant-assessee is an individual. The appeal arises out of the assessee’s Return for the A.Y. 2009-10. The assessee owned land with a bunglow on such land. The assessee demolished the bunglow to construct 08 flats on the land, some of which would be occupied by her for her own residence. The rest she intended to sell. The assessee retained 04 flats for her own use. The remaining 04 were meant for sale. The details of the names of buyers of these flats, dates of agreements to sale, dates of sale deeds and details of payments received by the assessee under the agreements to sale are as under;

Sr.No.	Name of the Buyer	Date of Sale Deed	Date of Agreement to Sale	Date of cheques & payment
1	Kankuben Mansingbhai Patel & Vipulbhai Mansingbhai Patel	10/09/08	19.01.2008	19.01.2008 – Rs.11,00,000/- 11.02.2008 – Rs.14,00,000/-
2	Naishadh Rajendra Diwanji & Toral Naishadh Rajendra Diwanji	15.12.2008	13.02.2007	11.12.2006 – Rs.5,00,000/- 04.01.2007 – Rs.5,00,000/-
3	Pavni Naishadh Diwanji	15.12.2008	13.02.2007	11.12.2006 – Rs.1,00,000/- 23.12.2006 – Rs.5,00,000/- 04.01.2007 – Rs.4,00,000/-
4	Equipment & Space Engineering India Ltd.	09/01/09	17.01.2007	18.11.2006 – Rs.10,50,000

3. The assessee considered the proportionate land apportioned to the 04 flat purchasers as sale of land belonging to her and disclosed long term capital gain of Rs.58,87,176/in the process. We may also note that the development permission was granted by the competent authority on 29.07.2006 and Building Use Permission was granted on 23.10.2008.

4. In the context of these facts, the Assessing Officer, during the scrutiny assessment of the Return filed by assessee, raised an objection to the assessee’s claim of deduction from the capital gains received by her on the ground that no construction was carried out after 23.10.2008, which is the date on which the Building Use Permission was granted. The flats were sold after such date by executing the sale deeds. This was not in tune with the statutory requirements for claiming deduction.

5. The issue eventually reached the Tribunal. The Tribunal, by the impugned judgment, confirmed the view of the revenue authorities by making the following observations;

“12. With respect to holding the assessee to be not eligible for deduction u/s.54F, it is an undisputed fact and also noted by CIT(A) that the transfer with respect to 4 flats by means of registered sales deed took place in FY 2008-09 relevant to AY 2009-10.

He has also given a finding that the building was constructed between 01.02.2007 and 23.10.2008 and the BU permission was granted by AMC on 23.10.2008 meaning thereby that no construction activity took place after 23.10.2008. For grant of deduction u/s.54F in case of construction of a residential house, the condition is that the assessee has within a period of three years after the date of transfer of long term asset, constructed a residential house. In the present case, since the construction took place prior to the date of transfer, we are of the view that CIT(A) has rightly appreciated the facts and by his well reasoned order held that Assessee is not eligible for deductio