24 January 2024
Dear sir Kindly guide on this issue 1) One client has land and building purchased in 1974 and 1.4.2001 value as given by SRO adopted. Falls under Sec 54F
2) The landover enters into Joint venture agreement in 2022 whereby total 5 units to be constructed, out of which 3 will go to owner and 2 will go to developer
3) 3 units for land owner got constructed by Developer for a cost of Rs7,80,00,000
4) Developer sold 2 units as UDS of vacant land during oct 2023
5) Consideration for landowner being
a) Monetary consideration Rs ,40,00,000 b) Sale of 2 UDS given to Dev Rs 1,00,00,000
Total Rs 1,40,00,000 6) Investment made
3 units involving construction cost Rs 7,80,00,000
7) Apparently the full value consideration invested in new building hence it would be exempt
8) In Sec 54 , if the entire sale consideration is invested in purchase/construction of one residential house within a period of 1 year before or 2 years after purchase and for construction 3 years.
9) My question is, since the client got 3 units as a consideration will he be hit by one residential house that one can buy/construct under sec54F
CAclubindia
