Capital Gain( Long-term)

This query is : Resolved

CA Sanjay Baheti (Querist)
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25 May 2011 One of my client being an individual having 2 residential Property in his own name.

Out of these 1 house is being gifted to his elder Brother in May,2011.As this is inhereted from his Father since long hence the same is considered as long term capital asset.

The remaining Second house is going to be sale off in Aug,2011 for a estimated sale consideration of Apprx.40 lacs.This was purchased from his own sources in F.Y.1990-91 of Rs.1.90 Lacs.
After indexing nearly Rs. 33.00 lacs is considered as long term capital gain.
Meanwhile the entire capital gain is going to be invested in purchase of new residential Property within stipulated time i.e. 6 months.

Now the query is how to treat the above tranasctions from the taxation point of view specially from capital gain & whether the long term capital gain from 2 house is being exempted from Tax by virtue of section 54 of I.T. act or not.

CA MANOJ GUPTA

CA MANOJ GUPTA (Expert)
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25 May 2011 1. IN THE CASE OF FIRST HOUSE NO CG WILL ARISE AS GIFT IS NOT TREATED AS TRANSFER UNDER SECTION 47
2. IN THE CASE OF SECOND UR QUERY IS SELF EXPLANATORY AS TO TAX TREATMENT
CA MANOJ GUPTA
JODHPUR
09828510543