Section 54- Construction of new property

An assessee completed construction of house property 10 months before sale of another property. Can he claim exemption u/s 54 in respect of the constructed property against the capital gains on sale of the another property?

Replies (6)

i dont think so

as it is specifically written over there that construction shuld have completed after sale of old house

it may start any time ie.before also but should have finished after sale only

I agree wid madhur.....

 

Dear Sai Chandu,

You can purchase house property within one year before and two year after  the date of selling house property but construction of property must be completed within three years after the date of selling house property.

no, he cann't claim exemption u/s 54 in respect of the constructed property against the capital gains on sale of the another property. Because construction should be within 3 years after the date of transfer.

you can do one thing..

if you got the property registered in the name of some one else, then you can still purchase it from that person and get exemption on the same house...

Sec 54 is meant to give relief and courts have ruled that it should b given a broader view to benefit the assessees.. In case its registered in your name... try to take legal advice...the ball may still b in your court..

According to my opinion, one can't claim the exemption in respect of the property constructed before the trasfer takes place. It is the residential property which is acquired and not constructed one year before or two years after the date of transfer.

Hence in your case no exemption benefit under sec-54.

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