whether benefit u/s. 54 allowable or not??
This query is : Resolved
09 January 2011
one of our client purchased a house property residential on 01/04/2010 for Rs. 25 lacs. he sold one of his residential property for Rs. 1500000 cost Rs. 500000 on 01/01/2011.
will exemption u/s. 54 will be available althought it was not purchased from money received on sale of residential property.
will exemption u/s. 54 will be available althought it was not purchased from money received on sale of residential property.
10 January 2011
Deduction u/s 54 will remain continue, it it was not calimed deduction u/s 54 earlier..
10 January 2011
yes it will be admissible, purchase has to be made either 1 year before or 2 years after the transfer of the residential unit. This case the time limit is only 9 months, hence covered.
10 January 2011
Eligibility condition of purchasing residential house within a period of one year before the transfer (sale)is satisfied; hence exemption u/s 54 can be claimed.
There is no stipulation and also not possible to establish nexus between purchase (made before sale) and sale (affected after purchase) transactions PRECISELY.
However, sale of old house would have resulted in increasing assets or decreasing liabilities from date of purchase (new house) to date of sale (old house). Better keep relevant information handy to the extent possible in the event of any ITO asking for details
A good question from a student
There is no stipulation and also not possible to establish nexus between purchase (made before sale) and sale (affected after purchase) transactions PRECISELY.
However, sale of old house would have resulted in increasing assets or decreasing liabilities from date of purchase (new house) to date of sale (old house). Better keep relevant information handy to the extent possible in the event of any ITO asking for details
A good question from a student
10 January 2011
There is basis condition to get benefit of Sec 54 that new house is purchased either 1 year before or 2 years after the transfer of the residential unit. Further there is no condition to use the money received on sale of residential property. Money have no colors. so u can utilize money lying in ur pocket or in ur bank a/c.
12 January 2011
deductin is available
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