Capital gain tax u/s 54

This query is : Resolved

Ashish Rajput (Querist)
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09 September 2008 Hello,

Pl let me know if the construction period of a builders appartment can be considered for calculating the mandatory holding period of 3 years to qualify the asset as long term capital asset. For example the apprtment was bought in Nov.06 with Bank Loan and the construction got completed in Nov. 09. Possession is still not taken and units is not yet registered in my name.

I intend to buy another under construction house property after selling the present one in Dec.09. Interested to know whether I can get the CG Tax exemption on the profit made on the first house property.

Thanks in advance for the suggestion.

CMA Jitendra Singh

CMA Jitendra Singh (Expert)
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09 September 2008 Definately ,the payment will be made in istalments.Please give details of instalments and refunded amount to u by the builder in case of surrender of rights

Ashish Rajput

Ashish Rajput (Querist)
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09 September 2008 Hi,

Thanks for the reply.I willbe selling the rights to a third party and expect to make profit of Rs. 10L. Can I save tax on this capital gain specially when the house property is not yet formally registered in my name and its only dwelling unit allotment made to me by the builder.

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K V Subba Rao

K V Subba Rao (Expert)
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09 September 2008 The Income Tax Department, I suppose, would compute the period of three years' holding from the time it is occupied by you as Owner, that is, from the date of occupation or registration whichever is LATER. Here occupation means including the rent for self occupied or let out under Income from House Property

Ashish Rajput

Ashish Rajput (Querist)
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09 September 2008 Dear,

Thanks.In that case, I assume that the rights in dwelling unit even doesnt get covered in the definition of capital asset unless its registered in my name. How do we treat such cases?

Ashish Rajput

Ashish Rajput (Querist)
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12 September 2008 Hi,

Is anybody there to have some information on the query?