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Is section 54F allowed to the transferor of asset also?

This query is : Resolved 

26 March 2023 Mr A and Mrs A are husband and wife.
Mr A invested shares of Rs 5,00,000 in FY 2016-17 in the name of Mrs. A.
Mrs A sold the shares in June2022 for Rs 50 Lakhs which is also the long-term capital gain for her.
Mr A purchased a house property for Rs 50 Lakhs in March 2022.
Query 1 - Mr A wants to claim 100 percent exemption under section 54 F. Can Mr A claim section 54 F for the purchase of house property after application of clubbing provisions of section 64 in his ITR.

Query 2 – Is Mrs A required to show sale of shares in her ITR or will it be shown in the ITR of MR A only.

Query 3 – If Mrs A shows sale of shares in her ITR, there will be tax payable in her return as the investment for 54 F is done by Mr A.
In case Mrs A is also required to show sale in ITR, how to reflect it without any tax liability?

27 March 2023 1. Yes.
2. No.
3. Declare it as usual with flag as income under clubbing provision.

27 March 2023 Thanks for your reply Sir. Can u explain the response 2 again.

Is Mrs A required to show sale of shares in her ITR ?

Actually Query 2 had two parts so your response is confusing me. Thanks for your patience.

27 March 2023 No declaration in ITR of Mrs. A, when the same is declared under ITR of Mr. A under clubbing provision.

27 March 2023 Thanks so much for all your help Sir. You are really helpful in providing resolution to income tax related queries. It is a case of genuine hardship to assessee where he gifted shares to his spouse and now the shares are sold and will be taxed in the hands of transferor. There is no concept of joint return in India and so the application of laws and reporting requirements in ITR sometimes provides challenges.
Thanks again for your help.

27 March 2023 My Pleasure.

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