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Ltcg on sale of foreign house property

Abdul Khader (STUDENT) (192 Points)

26 December 2017

the Assessee being a resident in india during the Assessment Year 2015-2016 sold his house property in USA

and subsequently reinvested the proceeds by buying a Flat in India, will he be eligible for exemption u/s 54 /54F ?

if yes, then is there any case laws

Thanks in advance

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5 Replies

kumar (CA-Final) (113 Points)
Replied 26 December 2017

Yes such gain can be invested in Flat located in India and assessee can avail exemption ....
when comes to Case laws... I tried but I didn't get them....

Rishi Mehta (Ur friend ) (1533 Points)
Replied 26 December 2017

Yes

First of all, assessee is resident of India. Any gain on transfer of Capital Asset as defined under the Act, shall be chargeable to tax in India in case of resident assessee irrespective of physical location of capital asset under issue.

Exemption: Exemption will be allowed only and only when investment in specified asset made within a period specified under the section you mentioned above. Further, new asset acquired must be in India.

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Rishi Mehta (Ur friend ) (1533 Points)
Replied 26 December 2017

Refer this case law CIT v. Syed Ali Adil (2013) (A.P.)

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Saksham Agrawal (20 Points)
Replied 29 December 2017

I think the act is quite clear on the matter. The original asset may / may not be in India but the new asset needs to be in India under section 54 of the act. It only requires the original house property to be one whose annual value is assessable under 'house property' head of income.