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long term capital gain

dsd1986@gmail.com (48 Points)

10 November 2018

Hello, I have sold one residential plot in 2 parts. half amount I received in January 2018 and other half in may 2018. total amount I received invested in purchase of one bigger residential plot in june 2018 itself. but will built a house in it in 2 years time from my savings money as entire sum is invested in plot. please clarify if I am satisfying all conditions of long term capital gain exemption

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8 Replies

Nitesh bind (Student CA Final ) (12692 Points)
Replied 10 November 2018

Yes, If you have invested the capital gain amount from sale of Residential Plot into Another Land/Plot within 2 years from the date of Transfer then you'll be allowed Capital gains exemption u/s 54B.

Building of House is irrelevant for the purpose of exemption u/s 54B. You'll get the exemption even if you have not built house on it.

Thanks.

1 Like

Manish Manu (198 Points)
Replied 10 November 2018

You will be for long term capital gain exemption

dsd1986@gmail.com (48 Points)
Replied 10 November 2018

thanks to all. but here main concern is money received in 2 different financial year but invested in one. will it be okay

Nitesh bind (Student CA Final ) (12692 Points)
Replied 10 November 2018

As I said If money invested in Land within 2 years from the date of transfer then exemption would be allowed. Money received in January 2018 if that invested before Jan 2020 even then it would be allowed.

You have invested both the amounts in 2018 itself. So it would be allowed under 54B.

Thanks.

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rama krishnan (12244 Points)
Replied 11 November 2018

@ nitish, IN my opinion, the property sold was residential plot and not urban agricultural land for claiming deduction under 54B.

since, the property sold was residential plot, it's eligible for deduction only u/s. 54f /54GB etc subject to conditions...

the date of registration is relevant here.... so in order to claim deduction under 54f, the entire sale consideration to be invested in new asset on or before filing the ROI or to be deposited in capital gains account scheme and the same should be appropriated towards purchase or construction of residential property within 2 years or 3 years respectively. correct me if I am wrong

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Nitesh bind (Student CA Final ) (12692 Points)
Replied 11 November 2018

@ rama krishnan Yes you are right buddy. I miataken RESIDENTIAL plot for Urban agriculture land. Exemption would be allowed under section 54F/54GB. Thanks.

1 Like