Vijay Pal Rao ORDER
Ramesh. C. Sharma, Member (A)
1. This is an appeal filed by the assessee against the order of ld. CIT(A), Alwar dated 18.12.2018 for the A.Y. 2015-16, in the matter of order passed by the A.O. 143(3) of the Income Tax Act, 1961 (in short, the Act). The ground taken by the assessee reads as under.
"On the facts and in the circumstances and in law the ld. CIT(A) erred in sustaining the action of the AO regarding disallowing the benefit of carry forward of long term capital loss of Rs. 14,76,729/- on the sale of shares for the current year."
2.1. Rival Contentions have been heard and records perused. The facts in brief are that the assessee is an individual and filed his return of total income on 29-08-2015, declaring income of Rs. 74,69,570/-. During the year under consideration, the assessee sold a commercial property being a showroom for a total consideration of Rs. 1,40,00,000/-. The indexed cost of acquisition was Rs. 36,74,643/-. The expenditure in connection with transfer of property was Rs. 24,165/- and thus the long term capital gain from sale of property was Rs. 1,03,01,192/-. The amount of sale consideration so received was transferred to capital gain account and such amount was used for purchases of flat. The assessee claimed deduction of Rs. 1,03,01,192/- u/s. 54F of I.T. Act. During the year, the assessee has suffered long term capital loss of Rs. 14,76,730/- on sale of shares which the assessee claimed carried forward as long term capital loss for the current year A.Y 2015-16. The AO firstly set off the long term capital loss suffered from shares from the long term capital gain from sale of commercial property and after intra-head adjustment the AO computed net long term capital gain at Rs. 88,24,461/- and from this amount he allowed deduction U/s. 54F and disallowed the carry forward the long term capital loss of Rs. 14,76,729/- for the current year on sale of shares.
2.2. By the impugned order, the ld. CIT(A) confirmed the action of the AO against which the assessee is in further appeal before us.
2.3. We have considered the rival contentions and carefully gone through the orders of the authorities below. The main issue in this appeal is whether it is lawful to first compute capital gain after doing intra head adjustments and whether the deductions u/s. 54F should be allowed from the net income computed after intra head adjustments. The law prescribes the computation of income in respect of each source under the head capital gain separately which should be calculated after giving deduction under section 48 to 55 of the Act.
2.4. The relevant provisions of Sections 45(1), 54F and 70 of the Income-tax Act, relevant to the assessment years read as follows:-
"45(1) Capital gains.-Any profits or gains arising from the transfer of a capital asset effected in the previous year shall, save as otherwise provided in sections 54, 54B, 54D, 54E, 54EA, 54EA, 54EB, 54F,