Long term capital gains

This query is : Resolved

Querist : Anonymous

Querist : Anonymous (Querist)

19 November 2011 Dear Sir,

This has reference to the above subject matter.

I have sold my flat last month at a consideration of 29.60 lakhs. This flat was bought in April 2004 at a consideration of Rs. 9.15 lakhs, financed by Standard Chartered Bank (SCB). Now total liability towards this flat is 7.10 lakhs, which I owe to the SCB.

I have two flats in joint names of myself and my younger brother
a. One in Pune, which was purchased in November 2009 and financed by SBI, the loan is on.

b. Second, in April 2011, I booked a flat in Talegaon Dabhade at a consideration of 25.60 lakhs, which is under construction.

I have one independent row house in my name, which was booked in 1990 , which is free from any loan, in Talegaon Dabhade where my mother and younger brother are presently staying.

I would like to know whether I can avail the Long Term Capital Gain Exemption against the Talegaon Dabhade Flat (as mentioned at 2b above), which I have registered in April 2011 (which is under construction and whose possession will take place in June 2012) .

Do I qualify for such exemption, when I have already have three residential properties on my name on the date of sale of the subject flat and I am claiming for the exemption on the third house.

Thanks and regards,

Venugopal

9372418018

CA SUMiT PATWARi

CA SUMiT PATWARi (Expert)
Follow

19 November 2011 There is no limit on number of houses u/s 54. Hence it is possible to claim exemption.
.
However you may doubt that the construction has started before the date of sale, and the term used is "the assessee has within a period of one year before or two years after the date on which the transfer took place purchased, or has within a period of three years after that date constructed, a residential house".
.
But then, keeping in mind the intention of the provision, exemption may be availed. It is fully allowed.

CA SUMiT PATWARi

CA SUMiT PATWARi (Expert)
Follow

Message likes : 1 times

Upgrade to CAclubindia Pro. Subscribe Now!

Querist : Anonymous

Querist : Anonymous (Querist)

19 November 2011 Dear Sumit Sir,
Thank you very much for your reply. How to go about in documentation while I file my returns after the completion of this FY (ie. AY 2012-13). What documents should I give to avail this exemption.
Regards,
Venugopal
PS: Can I speak to you SMS me your number on my cell: 09372418018, I will call you, whenever you are free.

Querist : Anonymous

Querist : Anonymous (Querist)

19 November 2011 Dear Sumit Sir,
My query. Since the new asset is 4 lakhs lesser than the capital gain (consideration of 29.60), Can I invest the 4 lakhs in LTCG Exemption bonds. Please confirm.
Thanks again.

CA SUMiT PATWARi

CA SUMiT PATWARi (Expert)
Follow

19 November 2011 The exemption will be upto the cost of the new house purchased/constructed.
In your case the consideration may be Rs29.60 lacs, but the Capital gains (Rs20.45L without indexation benefit) is lesser than the amount invested in new propert(Rs 25.60L). Hence, there is no need for additional investment in LTCG bonds.

Message likes : 1 times

Querist : Anonymous

Querist : Anonymous (Querist)

21 November 2011 Dear Sumit Sir,
Thank you very much for your guidance.
Regards,
Venugopal

CA SUMiT PATWARi

CA SUMiT PATWARi (Expert)
Follow

21 November 2011 You are most welcome !!!!

Upgrade to CAclubindia Pro. Subscribe Now!