Long term capital gain querry

Dear,

There will be long term capital gain... 

1) To avail exemption  you can invest in National Highway Authority of India's Bond or in Rural Electrification bonds within 6 month from the date of sale under section 54EC... 

or/and

2) Section 54F : You can invest in house property . But if you are purchasing house property, such property should be purchased within 2 years from the date of sale and if you are constructing house property then construction should complete within 3 years from the date of sale. 

Amount received from sale should be deposited in Capital gain account scheme in any nationalised bank... 

Rectify me if I am wrong...

Regards,

Siddharth Bumb.

sidbumbhelp @ gmail.com

WWW.SIDDHARTHBUMB.BLOGSPOT.COM

There is a Long Term Capital Gain, taxable under the head Capital Gain, however, to avail exemption amount of Net Consideration shall be invested in Long term Infrastructure bond with in 6 months from the date of sale.

@ Abhinav : I have a query on your post that 

Indexed cost of acquisition will be deducted from sale consideration and I will get long term capital gain..

whatever capital gain i get only such amount should be invested to avail exeption u/s 54EC.. then why sale consideration should be considered here?

@ Siddharth : I modify my reply

@ Abhinav : why net consideration?

if you are claiming exemption u/s 54F, then by using formula you need net consideration but for investing in long term infrastructure bond only long term capital gain will considered na..  not net consideration

@ Siddharth : my opinion is based on section 54EC.

Long term capital gain shoulb be considered ..i think

@ Abhinav : as per my study and knowledge maximum allowable exemption is "amount of long term capital gain or amount invested in such bonds whichever is lower" and not net consideration...

Dear Abhinav,

Siddharth is right, we have to invest equal to LTCG if we want to claim full exemption u/s 54EC.

Long term capital gain amount should be invested ( net consideration- Indexed Cost of acquisition) - The maximum permissable deduction u/s 54 EC is Rs.50 lakh  in NHAI or Rural  Electrification Bonds. Investment to be made within 6 months.

Long term capital gain amount should be invested ( net consideration- Indexed Cost of acquisition) - The maximum permissable deduction u/s 54 EC is Rs.50 lakh  in NHAI or Rural  Electrification Bonds. Investment to be made within 6 months.

Invest an amount equivalent ot CG

Invest the amount equivalent to Capital Gain.

Dear Abhinav,

Siddharth is right, only LTCG i.e the actual gains should be invested and not the net consideration. It will be LTCG and exemption can be claimed under Section 54EC or 54F provided prescribed condtions are satisified, Thanx.