Home loan in Section 54f where not using the full Capital Gain in buying a property

I have made a capital gain of Rs 50 lakh on shares where the overall share value is 70 Lakhs(amount received by selling). I want to buy a house within one year of share sell,  for 40 lakh. Can I apply for house loan(I will not use the sell proceeds for buy-ing house and only use 15 lakh from that and rest 25 lakh as house loan) and still use section 54F for tax savings. The shares were part of An employee stock ownership plan (ESOP) of a foreign company(USA). 

For 54 f can I save on 40*50/70 on LTCG or it will be 15*50/70 

 

Replies (4)
Quick Summary
This discussion explores the applicability of Section 54F for capital gains tax exemption when purchasing a new property using a combination of sale proceeds and a home loan. The user wants to know if a portion of the reinvested amount can come from a home loan, rather than solely from the net sale proceeds, and how this impacts the capital gains tax calculation under Section 54F.

For 54F formula is
LTCG*Amount reinvested/Net Considered received

Thanks Sourav for the reply.

So some part of the amount reinvested can come from home loan as well and need not be the completely from the Net Considered received.

Is the understanding correct?

Then you have to calculate in parts of amounts
The amount you invest in buying house out of the capital gain would be available for capital gain exemption.

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