Capital gain tax on sale of house property

This query is : Resolved

Querist : Anonymous

Querist : Anonymous (Querist)

07 June 2012 Dear member

I have sold my residential flat in f.y. 10-11 and reinvest the amount in new flat (flat A)in the same year.

Now i wish to sell this flat (flat A) also and purchase the new flat (flat B). Since the flat (flat A) is sold with in a 3 years time whether
i have to pay captial gain tax on the earlier flat

i have to pay capital gain tax on the sell of new flat (flat A).

Can i take the benefit of the amount which is reinvested in the new flat (flat B)

CA Siddhartha Bhardwaj

CA Siddhartha Bhardwaj (Expert)
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07 June 2012 1. The capital gain exempt earlier shall be reduced from the cost of Flat A and the balance shall be the cost of acquisition for computing capital gain on transfer of Flat A.

2. Since Flat A is being sold within 3 years, SHORT TERM CAPITAL GAIN shall arise on such transfer.

3. Exemption u/s 54 is available only in respect of LONG TERM CAPITAL GAIN. It is NOT available for short term capital gain.

Accordingly, you CANNOT claim benefit of investment made in Flat B.

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