capitalgain on sale of 2 houses

Man purchased one house on 1985 and another house in 2006 (by taking home loan on 2nd house) and sold both houses in 2010.

1.weather he will get benifit of section 54 on both houses

2. if he would pay amount of 1st house for repayment of loan of 2nd house then he would get any benifit in capital gain in any section (dont ask deduction of 80c And Loss under HP because of interest)

3.if he purchase 3rd house by taking home loan then also he would get benifit of section 54

please reply only if you have proper explaination and having proper section

Replies (1)

In order to get any exception u/s 54 the new residential house property should be purchased within one year before, pr within 2 years from the date of transfer. So capital gain from 1st house is not exempt, as 2nd house is purchased in 2006 which is not one year before the date of transfer which is 2010.

      Moreover, it is clear from the explanations to section 54 that if the amount of capital gain is not utilised for purchasing/construction of new residential property within the due to date for filing return of income the same shall be deposited in "CAPITAL GAIN DEPOSIT ACCOUNT SCHEME".

         So it clear for the present case that he has not utilised the capital gain amount for purcahse of new house, instead he has taken loan for it. so he wont get any excemption for the capital gain.

 

reg

Ajay

cwa -inter

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