Ltcg and sec 54, 54f

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This query is : Resolved

Querist : Anonymous

Querist : Anonymous (Querist)

24 September 2013 1. Can benefit of 54 and 54F be taken in construction of same residential house for LTCG arising out of sale of 2 properties - one residential house and another plot of land?
2. Can money paid to builder prior to sale of land on which LTCG arises, be considered as applied for construction against net realisation of sale of land for purpose of section 54F? Or is it to be ignored?
3. What happens if builder does not give possession with in 3 years of date when LTCG arose? More than 50% amount has already been paid for, and further sums will be paid till 3 years are over. Will this be accepted as substantial payment already made or will the assessee lose the benefit availed?

Thank you

Nikhil Kaushik

Nikhil Kaushik (Expert)
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24 September 2013 1. Should not be an issue.

2. Yes it can be. expenses incurred for construction of house in 1 year before the sale of property is allowabale.

3. Tricky. subject to litigation. often ruled in favor of the assessee.

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