Exemption under section 54

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Simran Katyal

Chartered Accountant

123 Points Posted on 15 March 2017

In regards to Sec 54 of Income Tax Act, exemption is available if:

a) New Property purchased before 1 year / after 2 years of sale of property., or

b) Constructed withing 3 yrs from sale of property

My query is that, will the exemption be available if a property is constructed before 1 year of sale of property, as section specifies 'Purchase before 1 year'.

Replies (3)

Dhirajlal Rambhia

SEO Sai Gr. Hosp.

121521 Points Posted on 15 March 2017

No; only the expenditures on construction during the specified period are allowed for exemption, even though the construction may have commenced prior to that date.

CA Gopal Somani

Consultant

1287 Points Posted on 16 March 2017

Please check my reply on

/experts/exemption-under-sec-54-2451039.asp

Nitish Agrawal

497 Points Posted on 16 March 2017

Originally posted by : CA CS Gopal Somani
	Please check my reply on /experts/exemption-under-sec-54-2451039.asp

Excuse me sir, I have a doubt regarding section 54F is it immaterial when the construction expenses has been incurred and if construction is completed within 3 years of transfer of property...all the construction expenses (pre and post transfer) will be eligible for considering for exemption or else only post transfer construction expenses will be eligible expenses for computing exemption amount. Please clarify.

Thank & regards,

CA Nitish Agrawal