Very very urgent capital gain u/s 54 f

This query is : Resolved

Querist : Anonymous

Querist : Anonymous (Querist)

24 February 2015 one of my friend has made investment in residential flats u/s 54 F to avoid capital gain now he want to give one flat to her sister as a gift in same a.y.
is it possible

vignesh

vignesh (Expert)
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24 February 2015 Dear anonymous, Good Evening
Since your friend is gifting his sister, (sister under the definition of "relative" and not cousin), the same is allowed as per Income tax act.
As per sec 47,56,54 of Income tax act, taking into consideration since a transfer amounts to capital gains in this case, but gift not considered as transfer, the same is possible in this case mentioned by you and "NO CAPITAL GAIN WOULD BE ATTRACTED" in ur case
However if your friends sister give the property as rent to any one the same would attract provision of clubbing and house property income would be calculated in ur friends income

REGARDS
Vignesh

Querist : Anonymous

Querist : Anonymous (Querist)

24 February 2015 sir, actually he has made investment more than one residential Flat(units) in same building(as per madras high court judgement)to avoid capital gain u/s 54 F

now he wants to give one flat to her sister as a gift if he is giving flat under settlement
then answer will be changed or remain same.

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vignesh

vignesh (Expert)
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24 February 2015 Mr anonymous, Greetings,
What is the asset that is sold?
Since multiple house comes into picture 54f would be the provision, where taxability comes into picture.
But say, there could be a possibility like,
If i sell an asset and buy one unit of flat and claim under 54f and transfer the same to sister, then go onto buy 2nd unit , there could be a possibility of allowance . But it is not proved in any case but could be a loophole.
In case the asset sold is residential flat it would be sec 54 completely and 54f wont come into picture

Querist : Anonymous

Querist : Anonymous (Querist)

24 February 2015 sir, actually he sold land to builder ,and builder has given 4-5 flats in same building in consideration which construction is going on . he got exemption u/s 54 F (as per high court judgement)

now he want to give one flat to his sister in same f.y. in which he claimed 54 F exemption
my query is this gift will be treated as a transfer or not
if he give proper through settlement deed then answer will be changed or remain same..

vignesh

vignesh (Expert)
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24 February 2015 Dear anonymous,
If the court has already given case in his favour, then it is final
Well Gift is not constituted as transfer as per sec 47 of income tax act, 1961
Sorry, i dint get the question on settlement. Did u mean for a consideration?
If u mean he is selling a flat to his sister for a consideration, then that constitutes a transfer and deemed to be a capital gain since the lock in period is 3 years u/s 54F
I hope your query is solved

vignesh

vignesh (Expert)
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17 April 2015 The query will be closed, since assumed to be solved