Double benefits for single expenditure??? Seriously??? Not possible on Earth. Several supreme court judgments on different issues like this.

Quoting the relevant extracts of Section 80C -

 

xviii) for the purposes of purchase or construction of a residential house property the income from which is chargeable to tax under the head “Income from house property” (or which would, if it had not been used for the assessee’s own residence, have been chargeable to tax under that head), where such payments are made towards or by way of—

(d) stamp duty, registration fee and other expenses for the purpose of transfer of such house property to the assessee,
but shall not include any payment towards or by way of—

          (A) the admission fee, cost of share and initial deposit which a shareholder of a company or a member of a co-operative society has to pay for becoming such shareholder or member; or

          (B) the cost of any addition or alteration to, or renovation or repair of, the house property which is carried out after the issue of the completion certificate in respect of the house property by the authority competent to issue such certificate or after the house property or any part thereof has either been occupied by the assessee or any other person on his behalf or been let out; or

         (C) any expenditure in respect of which deduction is allowable under the provisions of section 24;

 

The deduction u/s 80C is all about amount paid towards  payment of stamp duty/reg fee on purchase or construction of residential house property.

 

& also it mentions "ny expenditure in respect of which deduction is allowable under the provisions of section 24;"

 

But NO where it mentions " any expenditure for which exemption has been claimed u/s 54F from LTCG, shall not be allowable in 80C"

Originally posted by : S. Shiroor
	No deduction under sections 80C to 80U is allowed from long-term capital gains  https://www.incometaxindia.gov.in/Tutorials/15-%20LTCG.pdf

 

s.shiroor, 

 

th ques ws -

amt of stamp duty 10 lacs + cost of property = claimed as exemption us 54F from LTCG

then

amt of stamp duty 10 lacs deduction u/s 80C (upto 150000) claimed from total income (it may include slary income, HP, PGBP, etc)

 

 

Please read the pdf file carefully last or second last page.  

80C can be claimed if invested from different income but not from money got from capital gains.

I have understood ur question fully.

If one invests money got from LTCG  in NSC or PPF or stampduty and regd then it is not allowed as deduction under 80C.

Income from any other source is allowed as deduction.

If you pay 10 lks for stamp duty  then HP+ 8.5 lks can be  claimed under sec 54f

Pay  LTCG tax of 20% on 1.5 lk and the remaining 1.2lk +30 k from other source can be claimed as deduction    u/s 80C. 

I hope this is clear

According to me, since the law is silent wrt the exemption and deduction, the assessee's view can be taken. I.e claiming exemption and deduction simultaneously because if you cannot claim both then law should have been clearly specified.

And Giridhar, Wrt sec 24 and 80EE, in sec 80EE, it has been clearly mentioned that Where deduction under this section is allowed for any interest referred to in subsection(1), no deduction shall be allowed in respect of such interest under any other provisions of the Act or the same or any other assessment year

@ Rinkal   -- In the long term capital gains  (read the PDF file - it is income tax tutorial ) it is given 80C to 80U cannot be claimed if money is from LTCG.

S.Shiroor you posted this link, it says - "NO deduction u/s 80C to 80U is allowed from LTCG"

ie 80C cannot be (minus) from LTCG income.

https://www.incometaxindia.gov.in/Tutorials/15-%20LTCG.pdf

 

It cant be interpreted as saying that deduction cant be claimed if money used is of LTCG. Ther can always be other sources of Income to claim 80C deduction. which source of income is used to pay stamp duty- doesnot matters.

@ S. Shiroor

I agree but I am talking in reference to the stamp duty and registration that are in respect of purchase of HP and not LT Asset that is sold. 

To justify what I mean is

I have taken the view like exemption is considered in reference to sale of asset and deduction is considered in reference to purchase of asset.

Assume two of the conditions separately and then arrive at the final solution.

Hope I m able to clear my view

 

See the illustration of income tax dept it is not Minus.

of course in the return you can claim 80C and during scrutiny convince the AO that the money was from different source. 

The main question that 54F and 80C can be claimed simultaneously is not possible. 

i agree @ rinkal.. as 54F nullified the LTCG income by its exemption. 

 

80C talks about deduction for the HP purchased, if the income of that RHP is taxable under house property head. 

 

So, in my view, both are separate

@ Rinkal

There will not be a problem if the cost of house is  greater than LTCG. The problem will be when it is  equal or less than LTCG. It is the last 1.5lk bracket taken for 80C which may cause problems

Let us say you purchase a House for X +8.5lk +1.5 lk(Y)  [ 10 lk stamp duty]

1) u/s 54F you took exemption on Y  - so you saved 20% LTCG tax on Y (apart from X +8.5 lk)

2) u/s  80C you took deduction on Y As stamp duty paid can be used under 80c   - Your tax liability goes down by  10%/20%/30% of Y [depending on income bracket]  

You need to prove that Y in s,no 1 is different from Y of s.no 2 

Let us say they are different . This is possible only and only if

A) you make fresh investment of  1.5lk from diff source

   OR  

B) you claim only  X +8.5lk  u/s 54F.

If A is true than there is no question  you are spending 1.5lk more.

if B is true than you need to pay 20% LTCG on  1.5 lk or invest in Bonds and claim deduction under 54EC

or open  CG Accounts

If Y from both s.no 1 and 2 are same then you are getting double tax benefits for same application of Funds Y which will not be allowed in any courts.

This is what i was hinting at .

 

If the income is only from LTCG then 80C to 80U cannot be deducted from LTCg.

but if salary and LTCG both are there 80c will decuted from Salalry and Tax calculated and LTCG  will taxed at flat rate of 20%.  they should have given seperate examples.

If 1.5lk for stamp duty is from diff source it automatically follows that  amt claimed u/s 54F is X plus 8.5 lk only. In that case that  seperate 1.5lk can be kept in Capital gains accounts scheme.  or NHAi bonds can be purchased and claimed under 54CE or pay tax of 20% on 1.5lk i.e 30k.

Yes  the 1.5lk cannot be used for tax reduction at both places even though one is from sale of asset and another is purchase of asset. Two different 1.5lks need to be used or pay tax u/s LTCG or dont claim  u/s 80c.

 

Section 80C is the deduction available under chapter VI A and which can be claimed towards Gross Total Income of the relevant AY. And section 54F IS the exemption available towards the gains made and which is falling under the section 45 of CG chapter. Hence if the exemption is availed for full amount of CG then there is no question again claiming deduction under 80C as the same does not fall in Gross Total Income. But if there remains portion of CG even after availing exemption under 54F then yes, you can claim even the deduction under section 80C for the remaining amount which is of stamp duty & registration fee as the same is still forms part of GTI.

@ S. Shiroor,

I don't think you need to prove the AO that the money has been derived from other source.

Also there is no need for comparison of Cost of House and LTCG for claiming deduction U/s 80c.

80c deductions are in respect to gti excluding Ltcg u/s112 and stcg u/s 111A

Whereas exemption is in respect to CG