LTCG on sale of Residential Property & Exemption u/s. 54 EC

Tax planning 993 views 4 replies

shehzad

accounts executive

140 Points Joined March 2009

Dear All,

One of my friend is having 2 houses from which he is going to sell 1 house. He wants to invest in capital gain bonds of NHAI or REC & claim exemption u/s. 54 EC. He is a salaried person. So, he will file returns within July 31.

The property is sold in February, 2010. So, he has to invest the capital gain within 6 months from the date of sale in bonds. So, 6 months ends in August, 2010 while return due date is till july.

My question is:

What he can do, if he does not invest in bonds within return due date & still files return within due date? Is there any way to show that as still time is left for investment, he is not liable to tax on capital gains?

Suggest some alternative to it?

Plz its urgent.

Thanks

Replies (4)

Amir

Learner

4016 Points Joined December 2009

Dear Shehzad,

What is the issue brother either make an investment in July or File the return after making investment....

By the way, this is a practical hardship & all are aware of this fact that the benegit of Capital gain A/c scheme is not there under 54 EC...

So, Sorry nothing can be done both time limits are rigid..

shehzad

accounts executive

140 Points Joined March 2009

Dear Amir,

Thanks for your reply.

Now tell me what about Advance Tax? As the last installment is on 15th March & if investment is done after that period, what to do? Is advance tax on capital gain payable though time limit for investment is still left on 15th March.

My friend does not want to pay advance tax & claim refund as it is very tedious & the amount will also be huge.

Plz reply.