assessee has capital gain of 35 lakhs and deposited 48 lacs i.e. considerartion received on sale of asset by mistake in capital gain account now he has purchased a house of 40 lacs. So can he withdraw excess 8 lacs without paying tax from capital gain account?. the exemption is claimed under section 54 which state investment in property needs to be equal to capital gain and not consideration received. Kindly advice. URGENT
Hii,
In my opinion you can withdraw the amount. Since the balance amount of Rs. 8 lacs is not a capital gain. The only issue related is the amount was deposited under capital gain account scheme. However, the amount is actually not a capital gain, so taxing of the amount is not justifiable. I think this you can convince the AO.
Thank you :)
Karia Overseas
Ahmedabad
CA
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