Exemption of capital gains tax on purchase of 2nd resi prop

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varun rakesh goel (Querist)
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03 January 2012 dear sir

i want to know whether an individual/HUF can avail benefits of exemption from capital gains tax if he purchases one or more residential properties in the same name apart from the one he solely/jointly owns along with his other family members.

can this individual avail the benefits and avail expemption from capital gains tax?

please help in this regard

thank you

varun goel

CA PARAS BAFNA

CA PARAS BAFNA (Expert)
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03 January 2012 An Individual gets exemption from capital gains U/s 54 and U/s 54F.
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Section 54 exempts capital gains received from sale of Residential House Property. 54F applies where capital asset sold is other than house property. Here entire sales consideration is required to be invested in case of 54F.
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54F has restriction for owning not more than one residential house other than the new house purchased.
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Section 54, House against house case;
Assessee gets benefit even if he has 54 houses.
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varun rakesh goel

varun rakesh goel (Querist)
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05 January 2012 dear mr bafna

thank you very much for taking a serious note of my query. i still have a few questions:
1. if the assest from which the capital gain has arisen is RESIDENTIAL PROPERTY, then can i buy other residential properties to save my capital gains tax?
2. if i sell a residential piece of land approved by government, still how can i invest to save my capital gains tax if i want to buy other residential properties.

please throw some light in the same regards.

regards

varun goel

CA PARAS BAFNA

CA PARAS BAFNA (Expert)
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05 January 2012 Q 1. Yes. You will get exemption.
Q 2. In this case, where land is sold, exemption U/s 54F is applicable, but in a case where assessee has 2 or more houses
he will not be entitled for exemption.

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