Dear members,
I have specific queries on the applicability of Section 54F and Section 24 for the below situation.
Mr. A purchased a fully constructed apartment in March 2023 for INR 1.0Cr. He funded this through INR 80 lakhs bank loan and INR 20 lakhs from own funds. In addition, stamp duty of INR 10 lakhs was paid from own funds.
Mr. A sold some equity mutual funds in Jan 2024 for a net consideration of INR 1.35 Cr. The acquisition cost was INR 60 lakhs and LTCG was INR 75 lakhs.
- For availing Section 54F exemption, what should be cost of residential property to be considered: INR 1.0 Cr or INR 1.1 Cr (i.e., including stamp duty)?
- Can Mr. A claim the maximum possible deduction (i.e., 75*1.0/1.5 = 50 lakhs or 75*1.1/1.5 = 55 lakhs) in this case? If not, what is the deductible amount?
- If the loan is partly pre-paid say to the extent of INR 40 lakhs now, does the answer to Q2 change?
- Can Mr. A claim Section 24 (interest on home loan) deduction also in addition to Section 54F?
Thanks in Advance!
Krishna
CAclubindia
