Hello,
I had bought a flat in Jun 2006 in Mumbai, which I sold in Oct 2017, it resulted in some capital gains.
In Dec 2018 I bought another flat for a little more than the sell price of the earlier flat; so in effect I didn't have to pay any capital gain taxes.
This new flat is in a building which is more than 50 years old and now this building is planning to go for redevelopment.
My understanding is if the reinvested property is sold within 2 years that tax exemption is reversed. Although I am not going to sell the flat, I am confused what will happen if the building goes for redevelopment within 2 years of my flat purchase date? Will it be considered as sell and will my tax exemption be reversed?
Another question is, once the new building is ready we will be getting an additional room, a 2bhk flat instead of current 1 bhk. But I don't need 2 bhk flat, so I am thinking of selling this new 2 bhk flat once the building is ready and buy a new 1 bhk flat somewhere. Can I sell immediately or should I wait for some years to avail any tax exemption from this bigger flat sale?
Regards
CAclubindia
