Tax Implication
This query is : Resolved
21 April 2008
If a person has sold residential house property in India and has long term capital gain on it, will he be able to claim the benefit of Section 54 if he purchases residential house property outside India? Will the answer be different if he is non-resident in India last year?
21 April 2008
DEAR REHMAN SAB,
THE ANSWER IS IN AFFIRMATIVE.
THE FOLLOWING CASE LAW QUOTED IN CACLUB FORUM IS SUPPORTING THE VIEW THAT ONE CAN BUY PROPERTY OUTSIDE INDIA AND STILL GETS BENEFIT UNDER SEC 54.
Court : HC
Brief : : Held by the Ho"ble Bench that section 54 does not prohibit from purchasing property in a foreign country however all other conditions should be satisfied.The Bench also observed that the assessee should be the absolute owner of the new property in order to claim the exemption.
Citation : (1) Mrs. Prema P. Shah (2) Sanjiv P. Shah Vs. I.T.O.
Judgment :
Capital Gain - exemption u/s 54
(1) Mrs. Prema P. Shah (2) Sanjiv P. Shah Vs. I.T.O.
11/29/2005
(2006) 282 ITR (AT) 211 (Mumbai)
Case Fact:
Whether it is necessary to purchase new residential property in India to utilise the sale proceeds as received on sale of residential property, not acquired in convertible foreign exchange, for claiming exemption u/s 54(1) and whether the new property can be acquired on perpetual lease?
Decision:
Held by the Ho"ble Bench that section 54 does not prohibit from purchasing property in a foreign country however all other conditions should be satisfied.The Bench also observed that the assessee should be the absolute owner of the new property in order to claim the exemption.
NRI also enjoys same exemption as stated above LIKE A resident,but following points to be noted for compliance.
TRANSFER
1.) Sale to
a.) Person resident in India -No permission is required
b.) NRI (Citizen of India) No permission is required only if the seller is Indian citizen- All other cases prior RBI permission is required.
c.) NRI(Person of Indian origin) No permission is required only if the seller is Indian citizen - All other cases prior RBI permission is required.
d.) Others - Prior RBI permission is required
SOURCE:www.nritaxservices.com
R.V.RAO
DEAR REHMAN SAB,
THE ANSWER IS IN AFFIRMATIVE.
THE FOLLOWING CASE LAW QUOTED IN CACLUB FORUM IS SUPPORTING THE VIEW THAT ONE CAN BUY PROPERTY OUTSIDE INDIA AND STILL GETS BENEFIT UNDER SEC 54.
Court : HC
Brief : : Held by the Ho"ble Bench that section 54 does not prohibit from purchasing property in a foreign country however all other conditions should be satisfied.The Bench also observed that the assessee should be the absolute owner of the new property in order to claim the exemption.
Citation : (1) Mrs. Prema P. Shah (2) Sanjiv P. Shah Vs. I.T.O.
Judgment :
Capital Gain - exemption u/s 54
(1) Mrs. Prema P. Shah (2) Sanjiv P. Shah Vs. I.T.O.
11/29/2005
(2006) 282 ITR (AT) 211 (Mumbai)
Case Fact:
Whether it is necessary to purchase new residential property in India to utilise the sale proceeds as received on sale of residential property, not acquired in convertible foreign exchange, for claiming exemption u/s 54(1) and whether the new property can be acquired on perpetual lease?
Decision:
Held by the Ho"ble Bench that section 54 does not prohibit from purchasing property in a foreign country however all other conditions should be satisfied.The Bench also observed that the assessee should be the absolute owner of the new property in order to claim the exemption.
NRI also enjoys same exemption as stated above LIKE A resident,but following points to be noted for compliance.
TRANSFER
1.) Sale to
a.) Person resident in India -No permission is required
b.) NRI (Citizen of India) No permission is required only if the seller is Indian citizen- All other cases prior RBI permission is required.
c.) NRI(Person of Indian origin) No permission is required only if the seller is Indian citizen - All other cases prior RBI permission is required.
d.) Others - Prior RBI permission is required
SOURCE:www.nritaxservices.com
R.V.RAO
You need to be the querist or approved CAclub expert to take part in this query .
Click here to login now
Click here to login now
Similar Resolved Queries
Unanswered Queries
- Itr 1 processing
- Off Market debit and credit transaction
- Reporting Income under Section 44ADA
- Showing Gift from relative in ITR for this year
- ITR 1: Details for showing Exempt Income
- ITR selection for salaries and capital gain less than L
- Short Term Capital gain on shares bought and sold after 2018 onwards
- ITR returnFY25-26
- Form 10E u/s 89(1). Need clarification because experts opinions differ !!!!
- Share accounting-->fifo - capital gain - period as per fifo?
- Gst invoice numbering and delivery challan numbering
- Sales amount in Gstr1
- E Commerce GSTR1 & 3B how to file
- GST Cancellation without jurisdiction
- Legal Opinion on Registrar's Refusal to Investigate a Society for Non-Renewal and Non-Compliance
- GST Refund_RFD-01
- Form10BD was uploaded successfully without any Error but after 24 hours, Form10BE are not available
- Annexure B utility for GST Refund
- Tax amount diff in Gstr1 and 3B in tax compare reports
- Tds on GST in connection with sale to public company
Trending Online Classes
-
DT & Audit (Exam Oriented Fastrack Batch) - For May 26 Exams and onwards Full English
CA Bhanwar Borana & CA Shubham Keswani
Subscribe to Pro
Join an elite circle of professionals
CAclubindia
