capital gain Tax

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This query is : Resolved

R.Hanumandhan (Querist)

04 June 2009 IF ANY NOTIFICATION OR CIRCULARS ARE AVAILABLE FOR TAX EXEMPTION FROM CAPITAL GAIN ON LAND & BUILDING BY COMPULSORY ACQUISITION BY THE GOVERNMENT BY ANY LAW

Sumit gupta

Sumit gupta (Expert)

04 June 2009 Section 54D provides for exemption in respect of both long-term and short-term capital gains
arising from the transfer of land and buildings provided the following conditions are satisfied:
(i) The transfer is by way of compulsory acquisition of the asset
(ii) The asset transferred is land or buildings forming part of an industrial undertaking belonging to
the assessee
(iii) Such land or building were in use by the assessee for the purpose of the business of the
industrial undertaking for at least two years immediately preceding the date of transfer
(iv) Capital gain on a building will be a short-term capital gain since the same is a depreciable asset
as it is being used for business while land will be a long-term capital gain since it is not a
depreciable asset.
(v) The assessee purchases/constructs other land and buildings within a period of 3 years after the
date of transfer for the purpose of shifting or re-establishing the said industrial undertaking or
setting up another industrial undertaking.

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