Capital gains

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SWAPNEELKUMAR (Querist)
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31 December 2011 SIR,
I HAVE EXTINGHUSH MY REIGHTS FROM ONE OF THE RENTED OFFICE FOR VANCY OF OFFICE. THE RENT PAID IS NOT SHOWN IN INCOME TAX RETURN.NOW FOR EXTINGUISHMENT OF RIGHT I HAVE RECEIVED CERTAIN SUM IS THIS SUM IS TAXABLE AS CAPITAL GAIN.NOW IF I INVESTED THE CERTAIN AMOUNT IN PURCHASE OF ANY OTHER OFFICE THE WHETHER EXEMPTION UNDER CAPITAL GAIN WILL AVAILABLE OR NOT? IF YES IN WHICH SECTION.

THANKS

SWAPNEEL

CA PARAS BAFNA

CA PARAS BAFNA (Expert)
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31 December 2011 It is immaterial whether the rent expenditure has been shown or claimed by you in Income Tax in a case where your "HHE" or Drawings are shown at a sufficient
level so as to cover the Rent paid also.
.
U/s 55(2) Receipts against Tenancy Right is taxable as Capital Gains.
.
No exemption is allowable unless the right is a Long Term Capital Asset.
.
Where the LTCG is invested for Purchase of office exemption is not available.