05 November 2015
A SOLD A RESIDENTIAL HOUSE PROPERTY FOR 65 LAC.AMOUNT OF LTCG ARRIVED WAS 54.35 LACS.HE BROUGHT THE ENTIRE AMOUNT OF SALE PROCEEDS TO BOOKS OF ACCOUNT OF HIS BUSINESS FIRST THEN HE PURCHASED TWO FLATS ONE EACH IN HIS NAME AND WIFE'S NAME. ALSO RAISED HOME LOAN AGAINST BOTH THE PURCHASES. WIFE IS ALSO IT ASSESSEE. IS EXEMPTION U/S 54 AVAILABLE TO HIM AND TO WHAT EXTENT?
05 November 2015
If you read the section 54 carefully after the amendments you can claim exemption for investment in one residential property. Hence, whatever amount he invests in one property irrespective of whether he bought it from loan or his won funds. Exemption to that extent will be availalble.
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05 November 2015
As per section 54 deduction from long term capital gain, available upto the amount of Capital gain or amount invested whichever is less.
In your case Husband is eligible to claim deduction for only for one house i.e. house in which he has invested higher amount.
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