Section 54
This query is : Resolved
20 October 2015
CASE: Assessee has sold one house in july2014 and purchased a house in march 2015 and claimed exemption u/s 54, Now in July2015 he sold another house and the question is can he claim exemption u/s 54 for the same asset he purchased in march 2015???
20 October 2015
Section 54 is applicable to long term capital asset. Property purchased in March 2015 is not a long term capital asset, and hence any benefit under Section 54 is ruled out.
20 October 2015
the asset sold in july2015 is another asset and not the one purchased in march 2015
20 October 2015
It appears that assessee sold two residential property; one in july 2014, and other in july 2015. The assessee purchased a residential property in March 2015. The question is can he claim exemption for both the property under Section 54 for buying one property in March 2015. Yes. There is no bar that one cannot sell two residential property to purchase a bigger and better residential property.
20 October 2015
WHETHER 2 DIFFERENT FINANCIAL YEARS DONT MATTER IN THIS CASE
20 October 2015
No. The requirement is very simple... you had capital gain, and you used that money to buy a residential property... one year before sell or two years after sell. You had capital gain when you sold your first property and invested that within time limit. You had second capital gain, and you invested the gain before realizing capital gain. Merely because it is of two different financial years is irrelevant.
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