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CAP GAIN 54F and 54EC

Anuja (-) (141 Points)

07 July 2011

QUE:- IN F.Y. 10-11 CAPITAL ASSET OTHER THAN RESIDENTIAL HOUSE WAS SOLD AND A NEW RESIDENTIAL HOUSE WAS PURCHASED, THEREFORE SECTION 54F EXEMPTION WAS CLAIMED BUT IN NEXT YEAR ANOTHER NEW RESIDENTIAL HOUSE HAS BEEN PURCHASED HENCE LTCG EARLIER EXEMPT IS NOW TAXABLE . CAN I TAKE THE BENEFIT OF SECTION 54EC BY PURCHASING BONDS OF NHAI SO THAT I CAN REDUCE MY LTCG TAX LIABILITY(WHICH WAS EXEMPTED IN EARLIERE YEAR BUT NOW TAXABLE)? FROM WHICH DATE THE LIMIT OF 6 MONTHS SHALL BE CALCULATED?

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2 Replies

CA sudheer kumar sadineni (partner) (26 Points)
Replied 08 July 2011

helo anuja,

section 54F said a condition that,ON THE DATE OF TRANSFER of transfer of long term capital gain the assessee does not own more than one residential house property.

but in u r situation u bought another residential house property in next year.so the exempted long term capital gain does not going to txable.

if for any other reason the exemoted capital again taxable then you can not go for section 564EC.because the time period 6 months has lapsed .that is 6 motnths from the DATE OF TRANSFER.

REGARDS

SUDHEER