Capital Gain Exemption u/s 54

This query is : Resolved

Querist : Anonymous

Querist : Anonymous (Querist)

28 April 2011 My dad had a purchased a property in FY 1993 – 94 and sold the same in the FY 2008-2009. He has got profit for capital gains. In the same FY 2008 – 2009, he has entered into agreement for purchase of residential flat from the developer and claimed the exemption u/s 54 for the purchase of residential flat. But the construction of flat has been delayed as the sanction plan is approved from the concerned authority.
As per Sec 54, to claim exemption need to purchase the property one prior or 2 yrs after the date of transfer.
As my dad has already claimed the exemption now what are the tax implications as the construction of flat has been delayed as the sanction plan is approved from the concerned authority

Guest

Guest (Expert)

28 April 2011
If sales proceeds of Property was invested while entering into Purchase Agreement with Developer then there wont be any Tax liability, even if construction got delayed due to the fact that there was a delay in getting approval for the sanction plan.