Long term capital gain exemption u/s 54/54ec of i.t.act.

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CA Sanjay Baheti (Querist)
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21 June 2013 One of my client being an individual has owned a Residential Plot purchased in 1985-86. Hence it is long term capital asset.the he sold the same in 2013-14.the Long term capital gain comes to near about Rs.800000/- after taking benefit of indexation.Now to avoid long term capital gain tax @ 20% i.e. Rs.160000/- whether he can invest the entire gain in another residential Plot or invest in other manner under section 54/54EC of I.T.Act & whichever is more beneficial from tax point of view

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TKKKKKK (Expert)
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21 June 2013 He can invest in house and get benefit of exemption u/s 54. Besides he can also invest in 54EC within a period of 6 months from the date of transfer. Maximum amount he can invest in bonds is 50 lakhs.

CA Sanjay Baheti

CA Sanjay Baheti (Querist)
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21 June 2013 Mr.Khatri,

Thanks for reply.However i had one doubt that if at time of investment in new residential House/Plot the asesse has already owned another residential House (other than new one) then still he can claim deduction under section 54 of I.T.Act or not

CA Sanjay Baheti

CA Sanjay Baheti (Querist)
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TKKKKKK

TKKKKKK (Expert)
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21 June 2013 You can call me Ms khatri. (not mr khatri) anyways, I have not read about any restriction for having another house for claiming deduction u/s 54. This condition is for deduction u/s 54f.