Capital gains tax

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Querist : Anonymous

Querist : Anonymous (Querist)

27 April 2011 I had bought a flat for for Rs.82000 in Aug'94 and sold the same for Rs.9,55,000 in March'11.
Meanwhile I had started construction of a new house on a pre-owned plot of land in October'08 solely relying on the sale proceeds of the flat to meet out the cost of construction. The sale of flat however took a long time to mature. I expect to complete the construction sometimes in june'11.
Can I adjust the capital gains tax acrued against the cost of construction and claim exemptions?Are their any special exemptions available to me being a lady?

Tareq Imam

Tareq Imam (Expert)

27 April 2011 exemption due to construction can be claimed for construction within the time period of 1 year before and three years after the date of sale of the flat. in your case you need to show that the construction started within this period and proof of construction completion from municipal authority. If construction started in 2008 then no exemption possible

Querist : Anonymous

Querist : Anonymous (Querist)

28 April 2011 I am told that there has been a ruling from court that in case construction is completed within one year from the date of the sale then the date of start of construction does not matter.Kindly check and let me know.

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