Capital gain issue

This query is : Open

vipin rastogi (Querist)
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19 October 2012 Hi,
My query is regarding capital gain issue. I had booked a flat in a society 2 years back in 2010 of Rs. 42 Lacs and possession of it was after 3 years in 2013 but in june 2012 i have transferred this flat to some one else at Rs. 55 Lacs and invest the same amount for booking of other flat.
My query is that whether i will be attracted capital gain tax if yes then is it Long Term or Short Term and secondly whether i am eligible for exemption under section 54.

Thanks in avance

CA C.JANANI

CA C.JANANI (Expert)
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19 October 2012 The transfer made by you attracts short term capital gains as the period of holding is less than 3 years ,being immovable property.

You can avail the exemption given under 54 by investing in the new flat within the stipulated time.

shivaji prasad bhimavarapu

shivaji prasad bhimavarapu (Expert)
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19 October 2012 If the capital gain is from short term, Sec 54 exemption is NOT applicable.Sec 54 benefit is for long term capital gains only.So in this case,the rights in the Property(though not registered but conditions of Sec 53A of Transfer of Properties Act are satisfied)becomes an Immovable property transferred within 36 months and considered as Short term capital asset.Such gain is Short term cap.gain.The new flat purchase can not have other exemption but the sale proceeds can be shown as the sources for Investment.If registration is completed,the stamp duty can be claimed U/s 80 C.

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vipin rastogi

vipin rastogi (Querist)
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20 October 2012 Thanks a lot.. for the above query.
Mr. Prasad is Section 54 Exemption possible if i hold this flat for one more year i.e transferred after 3 years and reinvest the same amount in another flat.

Thanks in advance