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Deduction u/s 54F

23 July 2019

whether deduction u/s 54 F of income Tax Act 1961 on capital gain available when construction of residential house property with in 2 years on pre owned land after sale of residential house property.

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2 Replies

Mehul porwal (266 Points)
Replied 24 July 2019

Deduction u/s 54F can be claimed if consideration is invested in construction of new house property within 1 year before or 2 years after the date of transfer.

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Suresh Thiyagarajan (Student) (3986 Points)
Replied 24 July 2019

1. Sec 54F puts a condition only towards the construction of a residential property 1 year before or purchase within 2 years or construct within a period of 3 years from the date of transfer.
2. There is nothing wrong in constructing a residential property on land already owned. Since in your case construction got completed within a period of 2 years exemption u/s 54F will remain to be valid.
Please correct me if the above solution has an alternative view.