Exemption u/s 54-F

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Hi

 

I sold a long term asset. I invested it in a house property and claimed exemption u/s 54 F.  I got the house registered in my name. Later the builder due to some reasons asked me to take another house in exchange of that house.

 

What would be the tax implications ? whether i can claim the exemption u/s 54F

Replies (3)

Sir,

In this case the transaction will be considered as a transfer and liable to CG. further the condition u/s 54F will stand violated and the cost of acquisition of the house purchased by you will be reduced by the exemption availed earlier. Further the house transfered is not a long term capital asset (assuming less than 3 years) so benefit of exemption u/s 54 shall not be available..

this is my opinion and not supported by any decided rulling.

It is assumed that for the second house you have paid nothing to the builder.

We can help if you provide us the date of registration of 

1. Old House sold by you

2. New House purchased by you

3. House received in exchange from the builder

4. Exemption claimed in the Return of  Rs. ......

The Reason for seeking the above information is

To find out whether  it can be established that the house given by the builder in exchange

can be shown as the new house purchased by you for tax benefits U/s 54F. 

In my view you can show NIL or small Short Term Capital Gain on the new house and pay tax on it if there be any. 

  And adjust (take) the last house in query  for consideration 54F benefits.


 


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