Renovation cost of purchased house

This query is : Resolved

Querist : Anonymous

Querist : Anonymous (Querist)

18 September 2011 Can the renovation cost of purchased house be included in the acquisition cost for minimising/avoiding LTCG when this house is bought from the sale proceeds of a plot of land(Under section 54 F). Please explain.

U S Sharma

U S Sharma (Expert)
Follow

18 September 2011 if the renovation cost increase the efficiency of capital asset, i.e addition to the property, then it is to be capitalized,

normal wear and tear/ maintanance/ painting etc are not capital inclusion.

Querist : Anonymous

Querist : Anonymous (Querist)

18 September 2011 Please explain in some detail with reference to my question.

Upgrade to CAclubindia Pro. Subscribe Now!

Bhaskaran Chackrapani Warrier

Bhaskaran Chackrapani Warrier (Expert)
Follow

18 September 2011 Construction / purchase of house only qualifies for exemption under section 54F. The said section does not provide for exemption on investment in renovation or modification of an existing house.

Citation :- Mrs. Meera Jacob Vs. ITO (2009) 313 ITR 411 (Ker).

Message likes : 1 times

Querist : Anonymous

Querist : Anonymous (Querist)

21 September 2011 query is resolved