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Capital Gain

manikandan.J (Accounts Manager) (363 Points)

24 March 2010

hi everyone

please suggested me anybody about the Capital Gain amount Reinvested into residential or Commercial Property what are the consequences in the Long term capital gain and Short term capital gain condition to my client already having the own house he/she can reinvested U/s 54F elegilble or not it is very urgent

thanks in adance

mail me jmoneykandan @ gmail.com

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2 Replies

SHUVRO ( (WANT TO LEARN) ) (175 Points)
Replied 24 March 2010

hi Mr manikanda

ur clinet is elligible for claiming exemption u/s 54F as the act says that .....WHEN THE ASSESSEE DOES NOT OWN MORE THAN 1 RESIDENTIAL HOUSE PROPERTY ON THE DATE OF TRANSFER OF SUCH ASSET EXCLUSIVE OF THE ONE WHICH HE HAS BOUGHT FOR CLAIMING EXEMPTION U/S 54F .Provided the asset which he transferred is a long term asset other than a residential property.Also remember that the new house which is to be purchased must be:-

(A) If acquired , then within a period of 2 years after the date of transfer of the asset

(B) If constructed , then within 1 year before the transfer or 3 years after the transfer.

Hope u found ur solution

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nilesh dube (Service ) (74 Points)
Replied 25 March 2010

Dear Maniknandan,

Yes your client can claim exemption u/s 54F by investing in another residential property within the specified period.

He can claim exemption even if he already owns one residential property on the date of transfer. ie if he has purchased the existing residential property after the date of transfer of the capial assets on which capital gain is chargeable and he is planning to purchase another residential property in order to claim the exemption u/s 54F then he is not entitled to claim the exemption.

He can not invest in a Commercial property in order to claim the exemption.

Long term capital gain is chargeable to tax @ 20%

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