Become a Govt. Certified GST Practitioner in just 60 hrs. Register Now!

Section 54 of the Income Tax Act 1961

Mustafa Khojema Misri (Tax Manager) (35 Points)

15 July 2011

Residential property sold in August 2010 for59Lacs(Indexed Cost 14.62/-Rs.), LTCG-44.38 Lacs. Amount of 33Lacs invested in March 2010, in another Residential Property, but 33 Lacs invested by taking a housing loan of 25 Lacs.Does it Qualify under Sec 54?

Reply
Follow
Share

5 Replies

Sumit Grover (Chartered Accountant ) (3652 Points)
Replied 15 July 2011

yes it will qualify for sec 54 exemption

plz chck d following link in support of the same

https://taxworry.com/is-exemption-us-sec-54-allowed-even-if-new-house-is-purchased-from-borrowed-funds/

Upgrade to CAclubindia Pro. Subscribe Now!

Sunshine (Helping All) (10575 Points)
Replied 15 July 2011

apply a simple logic...in case u are purchasing a new house before the date of transfer of old house..how can u expect to invest the SAME AMOUNT which u received on the sale of old house...?? Its not possible coz u receive the sale inputs after u have already purcahsed a new house..so we reach a conclusion that the reinvested amount need not be the SAME amount received by way of transfer .......

Rup Kumar (finance manager) (288 Points)
Replied 16 July 2011

Yes it will qualify for exemption u/s 54.

Vijay (Adamo Studio) (2112 Points)
Replied 16 July 2011

Certainly qualifies because even if u purchased new HP before sale within one year then also it is allowable. Not compulsarily it need to be the same money.