54 f

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akhil phophalia (Querist)
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15 August 2015 My client has sold a plot for Rs. 55,00,000 /- of whcih registry is been done duirng the year 2013 - 2014 and some advance of Rs. 30,00,000 /- is been received duirng the year 2012-13 and balance Rs. 25,00,0000/- during the year 2013-14 at the time of regisrty . Also he has utilised that amount for construction of his already owned old house during the year 2012-13 & 2013-14. Will he can claim benefit of Sec. 54 F

Deepti Asawa

Deepti Asawa (Expert)
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15 August 2015 Assessee owned two residential houses. He sold one house and utilized its sale proceeds to construct first floor on his second house after demolishing old structure, in this case exemption will be allowable under section 54. [CIT vs P.V. Narsimhan [1989] 47 Taxman 89 (Mad.) However, in CIT v. V. Pradeep Kumar [2007] 290 ITR 90/ [2006] 153 Taxman 138 (Mad.), it was held that a mere extension of existing building would not give benefit to assessee under section 54F. Section 54F emphasizes construction of residential house and such construction must be real one and should not be a symbolic construction. Followed by ACIT vs T.N. Gopal [2009] 121 ITD 352 (Chennai-ITAT) (TM)
- See more at: http://taxguru.in/income-tax/exemption-section-54-54ec-54f-faqs-case-laws.html#sthash.Elz4kWyU.dpuf