54f and 54b
This query is : Resolved
10 August 2011
On sale of Urban Agriculture land can an assessee take the benifit of both Section 54F and 54B togather.
10 August 2011
You have sold a land for 50.00 lac.
Capital Gain is 40.00 lac.
.
You have to ascertain first - Whether the land has been used for the purpose of Agriculture within the 2 preceding years.
Now you purchase an agriculture land of Rs. 20.00 lacs. 54B will exempt half of your capital gain.
.
Now 20.00 lac CG is still taxable.
You Opt Section 54F.
Here you have to proportionately invest Rs 25.00 lac to get exemption of CG of 20.00 lac.
.
The Gain which is arising on the Agriculture land should be of a Long Term Capital Asset ( 3 years holding).
.
In that way you can get exemption in both the sections.
.
Pl hav views of experts also.
Capital Gain is 40.00 lac.
.
You have to ascertain first - Whether the land has been used for the purpose of Agriculture within the 2 preceding years.
Now you purchase an agriculture land of Rs. 20.00 lacs. 54B will exempt half of your capital gain.
.
Now 20.00 lac CG is still taxable.
You Opt Section 54F.
Here you have to proportionately invest Rs 25.00 lac to get exemption of CG of 20.00 lac.
.
The Gain which is arising on the Agriculture land should be of a Long Term Capital Asset ( 3 years holding).
.
In that way you can get exemption in both the sections.
.
Pl hav views of experts also.
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