LTCG - Cap gain Investment Scheme - Setoff

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This query is : Resolved

CA.Tarun Maheshwari (Querist)

20 March 2009 Dear Friends, I have a little doubt in my mind. When we deposit the Capital gain AMount in Investment scheme u/s 54 for claiming exemption, we need to utilise it for purchase of property. SUppose, in next year I withdraw the LTCG amount from the scheme and utilise it somewhere else. Then in that case, the so withdrawn amount shall become LTCG in my hand in that previous year in which money so withdrawn. Now, if I have some LTC Loss also, then can i get set off benefit between these two, i.e LTCG due to withdrawal of money and not utilising it properly, and the Long term capital loss. I hope I am clear, if anything not understood please let me know.

CA LOKESH KASAT, FCA, M.Com

CA LOKESH KASAT, FCA, M.Com (Expert)

21 March 2009 Dear Tarun,
No such clarification by Dept on this, in addittion no case law on this query.

But what i believe, if we go through section 54 we finds any amount withdrawn from CG scheme it will be taxed in the PY in which it is withdrawn.
So it will be LTCG only irrespective of this fact, so LTCL of that year will be eligible for set off.

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