Deduction u/s.54

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This discussion clarifies the conditions for claiming a deduction under Section 54 of the Income Tax Act when selling a house property and purchasing a new one. It confirms that Section 54 allows for such deductions without specific conditions like Section 54F. Furthermore, a landmark ITAT ruling allows taxpayers to invest capital gains from the sale of multiple properties into a single new residential house to claim the exemption.

Sonal

Sonal (Querist)
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17 November 2020 Hi All,
I have 2 house properties. I wish to sell one of that and purchase a new one . Can I claim deduction u/s.54 ? Like sec 54F , section 54 has any condition for claiming deduction.

Thanks in advance

CA R SEETHARAMAN

CA R SEETHARAMAN (Expert)
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18 November 2020 You can claim section 54 exemption. No such conditions in section 54.

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Sonal

Sonal (Querist)
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18 November 2020 can I sell two properties and purchase 1 u/s.54? Any case law reference for the same?

CA R SEETHARAMAN

CA R SEETHARAMAN (Expert)
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18 November 2020 Yes, it's allowed.
MUMBAI: In a landmark decision, the Income Tax Appellate Tribunal (ITAT) has held that a taxpayer can avail of tax benefits where long-term capital gains (LTCGs) arising on sale of more than one flat are invested or will be invested in one residential house in India, within the stipulated time.

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