Capital gain

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samir thakkar (Querist)
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22 October 2012 My client has incurred LTCG through sale of commercial property. He has deposited the entire amt in the capital gain account with SBI. He has the following queries :
1. Can he purchase a residential property on pugree basis i.e. purchases tenancy rights and makes pmt by chq. Can he avail the benefit of S.54F ?
2. The time for completing a deal is in July 2013. If he purchases a residential property on pmt of 20 % as booking amt and the bal pmt is to be made in instalments upto completion or on final completion, whereby the time is extended beyond the period of 2 years. Can he avail benefit of S.54F ?

@VaibhavJ

@VaibhavJ (Expert)
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22 October 2012 Hi

S. 54F provides for exemption from taxation of a long-term capital gain arising on transfer of an asset other than residential house, if the assessee has purchased or constructed a residential house within the specified period. Thus owning Tenancy Right doesnt Qualify.

He has to Invest Full amount in due time to qualify for exemption

Rgds//vaibahv

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