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In a limited scrutiny case of section 54 exemption inspection of newly acquired property was initiated by the AO. 

Upon inspection of newly acquired property in ( 2023] 103 ITR (Trib) 329 (ITAT[Chen]) it was found by the inspector that :

(i) The GF and FF and SF were meant for commercial purpose 

(iii) TF is used for residential purpose 

(iv) Fourth Floor was let out for residential purpose


With the result the assessee has split the purchase value for exemption claim between commercial and residential floors and clubbed TF and Fourth floor (FF) as one unit. 


The AO considered only TF as qualifying stating that the two residential floor are independent and only third floor would qualify for exemption so did the Tribunal held in this case. 


The ITAT held that it was assessee’s responsibility to establish that third and fourth floors are not independent which he failed to discharge in this case. 


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