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Capital gain case

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This query is : Resolved

Heena (Querist)

18 January 2013 Suppose....i sold flat at value less than stampduty value. The entire amount is invested in another flat market value of which is more than or equal to stamp duty value of flat which i sold.

by 50C ... Stamp Duty value will be considered as Sales Consideration .... but by virtue of sect.54 will i need to pay tax even if i have invested the whole amount in new flat stamp duty value of which is more than or equal to Stamp Duty value of flat i have sold.

@VaibhavJ

@VaibhavJ (Expert)

18 January 2013 Hey

S/54(1)(ii) states that..

if the amount of the capital gain is equal to or less than the cost of the new asset, the capital gain shall not be charged under section 45; and for the purpose of computing in respect of the new asset any capital gain arising from its transfer within a period of three years of its purchase or construction, as the case may be, the cost shall be reduced by the amount of the capital gain.

So no tax to be payable in this scenario if amount equals to capital gain tax is invested.

Thanks!!

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