section 54F

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Sunil (Querist)
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06 May 2017 scenario: I incurred LTCG in fy14-15 and took exemption by purchasing a flat on 25.3.15. This is my first house. I incurred again LTCG after selling a plot in fy16-17. Can I claim 54f again by purchasing another plot with full consideration and build a house after 2 years

Amol S Joglekar

Amol S Joglekar (Expert)
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06 May 2017 section 54F
Provided that nothing contained in this sub-section shall apply where—
(a) the assessee,—
(i) owns more than one residential house, other than the new asset, on the date of transfer of the original asset; or
(ii) purchases any residential house, other than the new asset, within a period of one year after the date of transfer of the original asset; or
(iii) constructs any residential house, other than the new asset, within a period of three years after the date of transfer of the original asset

Sunil

Sunil (Querist)
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07 May 2017 just want to make sure I am not violating clause iii by investing entire sales amount on a plot, claim 54f again within 3 years, but time the construction later so that it's after 3 yrs from first 54f and within 3 years of 2nd 54f

Sunil

Sunil (Querist)
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07 May 2017 any court judgements with similar cases dealing with tricky timing issues.

Amol S Joglekar

Amol S Joglekar (Expert)
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07 May 2017 if you invest entire sale proceeds in a plot, that is quite tenable at law because there is no any exemption u/s 54F for plot as new asset. You will be entitled to exemption only when you construct the residential house within a period of 3 years. (In your case since you bought a house on 25/03/2015.......you have to construct after 25/03/2018 but before 3 years from the date of transfer of the asset (i.e. the one sold in FY 2016-17)

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