Capital gain

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k.manmohan

CA Practice

30 Points Posted on 30 October 2013

Capital Gain:

Mrs. A Sold her landed urban property for Rs.35 Lakhs in Jan 2013 (Property purchased by her in March 2001 for Rs.2.70 Lakhs). Against this sale she received an advance of Rs.5 lakhs in Nov 2012. She does not have any house property in her name.

In Dec 2012, Mrs. A paid Rs. 10Lakhs as advance to landed property in Bangalore for the purpose of construction of a house in her name (Costing Rs. 80Lakhs). Further in Feb 2013, she paid 15lakhs as advance to the same land & 15 lakhs to the contractor as advance to construction in the said property. Whether the assessee can claim exemption U/s 54F for the year ending 31.03.2013.

Please note: She is a regular income tax assessee.

Replies (2)

CA Pallav Singhania

IT System Auditor

19347 Points Posted on 30 October 2013

Any Gain arising to an individual or HUF from the sale of any Long Term Asset other than Residential Property shall be exempt in full, if the entire net sales consideration is invested.

Purchase of one residential house within 1 year before or 2 years after the date of transfer of such an asset or in

Construction of 1 Residential House within 3 years after the date of such transfer

In case the whole sale consideration is not invested and only a part of the sale consideration is invested, exemption shall be allowed proportionately i.e.

Amount Exempt = Capital Gain X (Amount Invested/Net Sale Consideration)

You are eligible for exemption U/S 54F....