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54F or 50c

Sanjeet (Sr. Executive F&A) (114 Points)

25 July 2009

How Much Sould Invest under 54F if 50C is applicable???????

for example full value of consideration is 300000.00

stamp value 675000.00

which one of above should invest for 54F??????????

Plz. refer case if someone knows

thanks

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10 Replies

Ratan Deep Saxena (Asstt Manager (Accounts & Finance)) (2998 Points)
Replied 25 July 2009

sec 54F is an exemption for long term capital gain and hence it is the amount equals to capital gain that should be invested under section 54 F

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Sanjeet (Sr. Executive F&A) (114 Points)
Replied 25 July 2009

ya sir thanks for reply

i know that

but 54F talks about the net sale consideration

my question is that what is the net value of considertion in my case????????????? whather 3lacs or 6.75lacs

SHIVAM GROVER (student) (304 Points)
Replied 26 July 2009

u ask wrong ques

u r confused about sale value and full sale value consideration the exemption u will get of rs 675000 cause this should be considered your full value consideration not 375000 is your fullvalue consideration it is your sale value also this exemtion is on capital gain not on sale consideration here i assumed your long term capital gain is 675000 no expenses u did.....also this exemption is on propotionate basis u get....

Sanjeet (Sr. Executive F&A) (114 Points)
Replied 26 July 2009

thanks shivi for reply

bt belive me,m no confused. 54F talk u should invest the Net Sale Consideration. and meaning given under 54f for Net Sale Consideration is value accuring or recevied. nw m jst recevied 3lacs and m not doing any other business and not having any other source of income than how i can invest 6.75 lacs thats not possible. i think u understand my ques nw.

i know you may be right bt i need any case law or book refrence plz sand me if u hav.

thanks & waiting for reply!!!!!!!!!!!!!!!!!!!!!

SHIVAM GROVER (student) (304 Points)
Replied 28 July 2009

Originally posted by :Sanjeet
"	thanks shivi for reply bt belive me,m no confused. 54F talk u should invest the Net Sale Consideration. and meaning given under 54f for Net Sale Consideration is value accuring or recevied. nw m jst recevied 3lacs and m not doing any other business and not having any other source of income than how i can invest 6.75 lacs thats not possible. i think u understand my ques nw. i know you may be right bt i need any case law or book refrence plz sand me if u hav. thanks & waiting for reply!!!!!!!!!!!!!!!!!!!!!	"

i dont have any case law but i will try to solve your query in actual why u did it so it is illegeal bacausee u should valu your property as per stamp valuation if u dont do so if u take lesser amt it is only and only due to your fault incometax act will not give u any releif in this regard i am sure my answer will help u out

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VENKATA SAI KUMAR (SERVICE) (37 Points)
Replied 28 July 2009

hai,

Please go thru the subsection 2 of Section 50 C. - The Assessee claims before any Assessing Officer that the value adopted or assessed by the Stamp Valuation Authority exceeds the FMV of the Property as on the date of Transfer. The Assessing Officer may refer it to the Valuation officer. The reasons are genuine the Assessing Officer may accept the value of transfer. If the assessee on the basis of value of consideration received (375000) has to invest Rs.375,000/-. As Sec 50 C is a deemed provision, the Assessing Officer may adopt the consideration on the basis of Valuation Officer. In such case the Assesee needs to pay Tax on the difference between the value of propery as assessed by Valuation Officer and consideration actually received by the Assessee.

Sanjeet (Sr. Executive F&A) (114 Points)
Replied 28 July 2009

ok i try again to make it clear!!!!!!!!!!!!!!!!!

ok mere pass ek plot tha jis ki stamp value 675000 hai or market value 300000 thi manie wo sale kar diya

gain bhi 675000 ko le kar calculate kiya ok

nw my question is meine 54F ki exemption leni hai or uske liye mjhe NET SALE CONSIDERATION invest karna hai resd. house mein. ok

to mera ques hai ki mjh 3 lacs invest karna hai ya 6.75 karna hai

kyonki as per sec 54F mera net sale consideration to 3Lac hai.

i know every provision bt i jst want if some one hav any refernce or case law so please guide me.

Anuraag (CA Student) (44 Points)
Replied 28 July 2009

Hi Sanjeet,

U have to deposit the 50C value under 54 F... that is 6.75 lacs.... Since thats the value on which tax is calculated...

I have done simiar calculation for one of my clients in office... so am very sure,,, i will get u the case law tomorrow...

C.Balaji (Learner) (1867 Points)
Replied 31 July 2009

hello sanjeet.... as per sec 50c, if stamp value is higher than the sale consideration i.e. in your case .... you have to invest Rs.675000/- u/s 54f, eventhough you have received only Rs.300000/-.... But you can show Rs.300000/- a lesser amount , if you can prove to the authorities that the actual market value of the asset is only Rs.300000/- and not 675000/-... but one thing you have to invest the entire sale consideration incase of sec 54f...... Refer the following case law if you have doubt.....

RAVI KANT VS INCOME TAX OFFICER