6 months investment period given under sec. 54EC should be treated as six British Calendar Months

Facts

a) Assessee earned long-term capital gains from sale of his ancestral property on 3-10-2008.

b) He invested amount of capital gains in REC bonds and claimed deduction under section 54EC.

c) Assessing Officer (AO) held that since the investment in the specified securities as stipulated under section 54EC was not made on or before 12-4-2009, i.e., within six months from the date of transfer of the property, the assessee was not entitled to claim deduction under section 54EC.

d) Commissioner (Appeals) upheld the order of AO. Aggrieved-assessee filed the instant appeal before Tribunal.

The Tribunal held in favour of assessee as under:

1) Section 54EC clearly stipulates that the investment has to be made in specified long term assets within a period of six months after the date of transfer of the original asset.

2) The word "month" is not defined under the Act, thus it has to be reckoned according to British Calendar in terms of section 3(35) of the General Clauses Act, 1897.Hence, six months period should be reckoned from end of month in which transfer took place.

3) REC bonds were subscribed by the assessee on 24-4-2009 and were allotted to the assessee by REC on 30-4-2009 which is within six months after the date of transfer of asset as per British Calendar month.

4) Since assessee fulfilled the conditions laid down under section 54EC, he was eligible for deduction under section 54EC.[2017] 77 taxmann.com 174 (Mumbai - Trib.)