Happy CA Day! Get 10% OFF on CAclubindia Pro 1-Yr & 2-Yr Plans. Subscribe Now!

Capital gain

549 views 1 replies

Lakshmisha. B. S

assisstant

92 Points Posted on 16 June 2012

A & B (FATHER & SON) purchases site jointly and constructed a residential house at cost of 25 Lakhs investing 12.5 Lakhs Each. A Invested amount from the sale proceeds of a House Property with in a year on ehich Long Term Capital Gain gain work out Rs. 12 Lakhs and B invested the amount from Bank Loan can A Get Exmption U/s 54

Replies (1)

Rammohan

255 Points Posted on 17 June 2012

If there is clear documentary proof - say a formal agreement - between A and B about their respective shares in the total investment, and if A has proof of his LTCG from the sale of his earlier house property, then A should get exemption for his investment of Rs 12 lacs in the jointly held property. B should keep proper records of repayment of his bank loan according to the terms. It is presumed that the property is registered in the joint names of A and B setting out their respective shares. It is advisable for A and B to pay the dues such as property taxes etc. in equal proportion.