Capital Gain

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VIMAL (Querist)
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26 October 2010 Section 54(1) of Income Tax Act 1961 provide that upon sale of residential house the assessee should have purchased or constructed a residential house. The question arise as to whether the words residential house mean one house or whether the assessee will be entitled to exemption in respect of amount invested in two or more houses. Please site any case law on the above matter.Thanks. Vimal

taxindiaconnect

taxindiaconnect (Expert)
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26 October 2010 There is one case law KC kaushik VS ITO 84CTR62 in which the court has said that if the assessee has purchased more then two houses, it is up to assessee to chose for which house he takes the deductions. From this case an interpretation can be drawn that the exemption is avaiable only for one house.