Capital gains and house loan

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harsh malpani (Querist)
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26 October 2015 i had sold a property and had capital gains under section 54f.the amount of sales consideration on my part that i need to invest to get tax exemption is 35 lacs which i paid to builder from my account before date of filing the return.THE property that i purchased will be registerred at around value of 50 lacs. i approached bank .they said they will keep 20% margin and rest they can finance. so on 50lacs they can finance me 40 lacs 80%. if i get it done then bank will pay builder 40 lacs. so total payment to builder would be 35 lacs that i paid and 40 lacs that bank paid i.e. 75 lacs and buider will refund me extra 25 lacs which i will use for my house interiors. will i be eligible for capital gains tax exemption or will it be treated as refinancing of capital gains. am i eligible for tax benefit. also bank says that my income shows only income from other sources that get from interest income from my fathers firm.if i get the registry done in my name and get housing loan on my fathers name where i become the co borrower who will get income tax benefit of principal and interest me or my father

ANKIT AGARWAL

ANKIT AGARWAL (Expert)
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27 October 2015 The property should be purchased by the person who wants to avail the capital gain exemption. Mode of payment is irrelevant. purchasing on bank finance is a sufficient to claim exemption.

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harsh malpani

harsh malpani (Querist)
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27 October 2015 THANK YOU SIR SO CAN I TAKE BACK 25 LACS FROM BUILDER BACK AND THEN USE THAT AMOUNT IN ANYWAY EITHER FOR THE PURPOSE OF ALTERATIONS IN MY HOUSE OR AS I LIKE TO USE THAT AMOUNI LIKE AND STILL CLAIM THE EXEMPTION UNDER CAPITAL GAIN. OR SHOULD IASK THE BANK TO FUND ME FOR ALTERATIONS THROUGH A DIFFRERENT LOAN

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