Valerian Dsouza (Manager Audit & Taxation) (413 Points)
02 February 2015A Service provider Company is selling Office premises purchased 10 years ago, regularly claiming depreciation.
1. No LTCG since it is depreciated Asset, right?
2. Thought it is taxed as STCG, whether company can invest bonds and calim benefit u/s. 54EC?
3. How else Company can save capital gain tax?
Thank you for your kind advice.
Raphael
(Chartered Accountant)
(214 Points)
Replied 02 February 2015
Dear Sir,
1. Yes the gain is STCG in nature.
2. 54EC can be applied only in case of LTCG
3. If the company is buying a new asset of the similar block, then STCG can be avoided by keeping the block of depriciable asset alive.
GULRAJ AILANI
(CA)
(234 Points)
Replied 02 February 2015
Benefit under section 54 EC can be claimed , there is case law on this. I cant remind the name of case law right now. But the conclusion of case law is that
a) section 50 only says the Taxability of depricable Asset i.e whether it can be taxable as Long term capital gain or short term capital gain. section 50 only says about taxability of Depriciable Asset. Section 50 does not classify it as a Short Term Capital gain or Long term Capital gain. For classification of Asset as Short term or Long Term Creitieria for 36 months can be applied even in case of Depricable Asset. Hence benefit under section 54For 54EC can be claimed.
Saurabh Maheshwari
(B.com,ACA)
(5923 Points)
Replied 03 February 2015
Totally agreed with Gulraj...the case law he is pointed out is-CTI vs Rajeev Shukla,Hon'ble Delhi HC
Saurabh Maheshwari
(B.com,ACA)
(5923 Points)
Replied 03 February 2015
Totally agreed with Gulraj...the case law he haspointed out is-CTI vs Rajeev Shukla,Hon'ble Delhi HC.
Arif Ali
(Apt Co Advisory)
(1230 Points)
Replied 03 February 2015
| Originally posted by : Valerian Dsouza | ||
 |
A Service provider Company is selling Office premises purchased 10 years ago, regularly claiming depreciation. 1. No LTCG since it is depreciated Asset, right? 2. Thought it is taxed as STCG, whether company can invest bonds and calim benefit u/s. 54EC? 3. How else Company can save capital gain tax? Thank you for your kind advice. |
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1. yes correct.
2. yes you can save tax by investing under 54EC. since it is LTCA even if STCG on it.
3. investing under section 54F and 54EC. or you can purchase new asset under same block.
Raphael
(Chartered Accountant)
(214 Points)
Replied 03 February 2015
Thank you dear friends,
I just browsed through the case law and you all are right. This was new information to me.
GSTR 9 and 9C for FY 23-24 as amended by Notification 12/2024 dated 10th July 2024(with recording)
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