Exemption u/s 54 and Gift of property received

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A client received a property as a gift from her son in April 2023 and purchased another property in March 2023. She wishes to sell the gifted property and claim an exemption under Section 54 of the Income Tax Act. The concern is whether the exemption is valid since the gifted property wasn't in her name at the time of purchasing the Pune property. Expert opinion confirms the exemption is claimable, provided the son held the property for over two years. The holding period for the gifted property is considered from the original purchase date in 2019, not from when the son acquired full ownership or gifted it to his mother.

Priyanka

Priyanka (Querist)
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08 May 2023 Hello
Client has already purchased a Residential property in March 23 in Pune
In April 23, her son make a gift deed of another property at Mumbai and transferred ownership of the same from his name to his mother's name i.e. client.
Now the client is willing to sale the property which is acquired as Gift from son ( Mumbai ) in coming months
My query is, If client sales such property, will she be able to claim exemption u/s 54 of property already purchased at Pune in March ?
Because the property which she is selling was not on her name in March 23. which is point of concern for me
Kindly give your expert opinion on such scenario

Dhirajlal Rambhia

Dhirajlal Rambhia (Expert)
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08 May 2023 Yes, she can claim exemption u/s. 54 of IT act, provided son held the house property for more than 2 years.

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Priyanka

Priyanka (Querist)
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08 May 2023 Hello Sir
The property was previously acquired by Son and father jointly in 2019. father gifted his share to his son in 2022
Now son has gifted entire 100% it to his mom in 2023
from when the holding period will be considered ? right from original ownership of property 2019 or from 2022 ? please guide

Dhirajlal Rambhia

Dhirajlal Rambhia (Expert)
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08 May 2023 2019. Original date of registration of purchase deed.

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