54 Capital Gain Exemption

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If you sell a residential property and reinvest the proceeds into a new residential property under your wife's name, you may still be eligible to claim an exemption under Section 54. Indian High Courts, including Delhi and Madras, have ruled that the new property doesn't need to be solely in the assessee's name, provided the investment originates from the sale proceeds.

deepak mittal

deepak mittal (Querist)
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02 July 2025 if husband sold the residential property and same proceed invested again in residential property in the name of wife then he is eligible to claim deduction under section 54 ?

Dhirajlal Rambhia

Dhirajlal Rambhia (Expert)
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02 July 2025 CIT v. Kamal Wahal [2013] 30 taxmann.com 34 (Delhi High Court): This is a frequently cited case where the Delhi High Court held that the new residential house need not be purchased exclusively in the name of the assessee. If the investment is made in the name of the wife, who is not a stranger, and the entire investment comes from the sale proceeds, the exemption under Section 54F (similar to 54) is allowable.

CIT v. V. Natarajan [2006] 154 Taxman 399 (Madras High Court): The Madras High Court held that exemption under Section 54 was available even if the residential property was purchased in the name of the assessee's wife out of the sale proceeds of another house property.

deepak mittal

deepak mittal (Querist)
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02 July 2025 Thank you very much

Dhirajlal Rambhia

Dhirajlal Rambhia (Expert)
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02 July 2025 You are welcome.

Dhirajlal Rambhia

Dhirajlal Rambhia (Expert)
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27 September 2025 Good luck..

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