Capital gain saving applicability

Tax queries 240 views 5 replies

I have purchase a house for 148 lakhs jointly with wife in Nov2019  I  invested my retirement benefits and saving. 

After 10 month in Sep 2020 I have sold my flat for 48.75 lakhs.   Can I use this lcapital gain  for claiming the tax saving  as it was BUY first  and  SELL later with in 1 year.

If it is acceptable  can I build a new house in my  site for 50 Lakhs.  some one said that If I construct a new house with in in three years , capital gain  saving will be canceled. Other said is it applicable only to 84F  case not for section 84.

Please clarify

Replies (5)
Go through with section 54F and 54EC of capital gain

I have purchase a property in Nov 2019 for 75 lakhs  and transaction is completed.

I have sold a  old flat property  in Sep 2020 for 50 Lakhs. 

Can I claim LTCG exemption under BUY first  completely and SELL old house  with in one year. 

  

54F. (1) Subject to the provisions of sub-section (4), where, in the case of an assessee being an individual or a Hindu undivided family, the capital gain arises from the transfer of any long-term capital asset, not being a residential house (hereafter in this section referred to as the original asset), and the assessee has, within a period of one year before or two years after the date on which the transfer took place purchased, or has within a period of three years after that date constructed, one residential house in India (hereafter in this section referred to as the new asset), the capital gain shall be dealt with in accordance with the following provisions of this section, that is to say,—

 (a) if the cost of the new asset is not less than the net consideration in respect of the original asset, the whole of such capital gain shall not be charged under section 45 ;

 (b) if the cost of the new asset is less than the net consideration in respect of the original asset, so much of the capital gain as bears to the whole of the capital gain the same proportion as the cost of the new asset bears to the net consideration, shall not be charged under section 45:

Provided that nothing contained in this sub-section shall apply where—

 (a) the assessee,—

 (i) owns more than one residential house, other than the new asset, on the date of transfer of the original asset; or

(ii) purchases any residential house, other than the new asset, within a period of one year after the date of transfer of the original asset; or

(iii) constructs any residential house, other than the new asset, within a period of three years after the date of transfer of the original asset; and

 (b) the income from such residential house, other than the one residential house owned on the date of transfer of the original asset, is chargeable under the head "Income from house property".

if all conditions are satisfied you can claim exemption. 

thank you Manish Sir for reply,

Since I purchase a new flat in Nov 2019 with my savings and sold my old flat in Sep2020, can I claim the LTCG  under section 54.  The rule of withdrawal of LTCG deduction  it applied if I construct a new house with in 1 year as in 54F is also applicable to section 54 also.  Please clarity

@ Mr. Vijay Kumar

Yes, If your old flat which is sold in September, 2020 is old more 2 years, than you can claim Exemption under section 54 as earlier purchased November 2019 flat.(which is within time limit of one year before sale of old flat).


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