Capital gains

This query is : Resolved

C.A Srivatsan E.K (Querist)
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14 May 2008 Dear friends,

I'll put forth my doubt here.Sec. 54 of IT Act is applicable w.r.t sale of a residential property and investment in another residential property.What will be the consequence if a person owning 3 flats with separate door nos. (within the same compound) sells all of them and invests in a single residential property.Also explain the wealth tax perspective of this transaction.
thanking you in advance,
srivatsan

CA Hemant T Dewani

CA Hemant T Dewani (Expert)
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15 May 2008 if all theree flats are in one compound & he living in that house then you will purchase another house for capital gain
in wealth tax u/s 2(e)(a) & Sec 5 of the same act one house or 500 sq mt land are exempted from wealth tax & in the above cases your purcasing three houses & residing in the same house only doors are different but in the same compound are not liable to wealth tax

C.A Srivatsan E.K

C.A Srivatsan E.K (Querist)
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28 May 2008 thanks sir.Sorry for the late reply.what will be the capital gains impact when the 3 properties within the same compound are sold and the consideration amount is invested in a single residential property? i'm unable to understand the wealth tax impact.pls. elaborate.
thanks in adv.

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