reinvestment of lng term capital gains
This query is : Resolved
04 April 2008
i have two ques..
1) can the long term capital gains arising out of sale of long term residential property has to be invested only in 1 new residential property or can it be invested in more than 1 residential property?
2) can the long term capital gains arising from sale of agricultural land has to be invested only in another agricultural land or can it be invested in residential property also?
regards
Rohit Sharma
1) can the long term capital gains arising out of sale of long term residential property has to be invested only in 1 new residential property or can it be invested in more than 1 residential property?
2) can the long term capital gains arising from sale of agricultural land has to be invested only in another agricultural land or can it be invested in residential property also?
regards
Rohit Sharma
K V Subba Rao
(Expert)
04 April 2008
(1) Yes. Refer Para 71.1.5 of 30th edition of Singhania's Direct Taxes Ready Reckoner
05 April 2008
ANS. TO QUERY 1.
THE USE OF THE ALPHABET "A" IN SEC 54 CREATED SOME CONFUSION .
BUT IT CAN BE SAFELY INTERPRETED THAT CAPITAL GAINS INVESTMENT CAN BE MADE IN MORE THAN ONE RES. PROPERTY
ANS. TO QUERY 2.
THE CAPITAL GAINS ON SALE OF AGR. LAND CAN BE INVESTED IN RES. PROPERTY ALSO. THIS IS STATED IN SUB SEC (1) OF SEC 54F THAT TALKS OF EXEMPTION FROM CAPITAL GAINS ON INVESTING IN A RES. PROPERTY.
IN SEC 54 (F),SUB SEC 1 THE WORDS USED ARE AS FOLLOWS:
- FOR AN INDIVIDUAL OR HUF ,THE CAPITAL GAIN ON TRANSFER OF ANY LONG TERM CAPITAL ASSET -
R.V.RAO
THE USE OF THE ALPHABET "A" IN SEC 54 CREATED SOME CONFUSION .
BUT IT CAN BE SAFELY INTERPRETED THAT CAPITAL GAINS INVESTMENT CAN BE MADE IN MORE THAN ONE RES. PROPERTY
ANS. TO QUERY 2.
THE CAPITAL GAINS ON SALE OF AGR. LAND CAN BE INVESTED IN RES. PROPERTY ALSO. THIS IS STATED IN SUB SEC (1) OF SEC 54F THAT TALKS OF EXEMPTION FROM CAPITAL GAINS ON INVESTING IN A RES. PROPERTY.
IN SEC 54 (F),SUB SEC 1 THE WORDS USED ARE AS FOLLOWS:
- FOR AN INDIVIDUAL OR HUF ,THE CAPITAL GAIN ON TRANSFER OF ANY LONG TERM CAPITAL ASSET -
R.V.RAO
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