VS Vedhagiri (Chartered Account) (96 Points)
26 June 2021Dear Members
My client sold his residential land in April 2021 with capital gain of Rs 1.78 cr. He wants to know whether he can invest in OLD and renovated residential house for Rs 2.75 Cr. What is the time limit for the investment if he can invest in OLD house. He owns a residential flat
CA. Sourav Sarkar
(Chartered Accountant )
(24583 Points)
Replied 27 June 2021
VS Vedhagiri
(Chartered Account)
(96 Points)
Replied 27 June 2021
Thanks Is investment in old house allowed?
CA. Sourav Sarkar
(Chartered Accountant )
(24583 Points)
Replied 27 June 2021
CMA Poornima Madhava
(CMA)
(13112 Points)
Replied 27 June 2021
As I understand, there is no restriction to buy/construct only a new house (i.e. even existing house may be purchased).
House to be bought within 2 years from date of transfer. However, if not purchased before due date of filing of ITR for the relevant year, then amount to the extent of unutilized capital gain to be transferred to a capital gain deposit account.
So in this case, since the sale is effected in April 2021, you need to utilitze the gain by July 2022 (subject to any extension).
VS Vedhagiri
(Chartered Account)
(96 Points)
Replied 27 June 2021
Thanks for your reply. Are you sure about the date of the utilisation.
“So in this case, since the sale is effected in April 2021, you need to utilitze the gain by July 2022”
I thought it is July-2021
thanks
ajeet singh
(1392 Points)
Replied 29 June 2021
CAclubindia
