yes, you can purchase new house property to save tax.

Yes u/s 54, you can claim exemption and can bought a new residential house but you cant sell that house for next 3 years.

Your construction might take some time (say 6 to 7 months).....and exemption is  available only  if the house has been constructed till due date of filling of return of income or if the same is not possible then keep your funds likely to be used in construction in a special account tobe opened under Capital Gains A/c scheme,1988........(the exemption will be available equal to the amt. deposited in CGAS,1988)......so it is advisable to deposit the investible amount in A/c under CGAS,1998 and then withdrew from the bank as and when required by submitting FORM-C to bank.

Hi Maish...Exemption is - you can use that money for construction in next 3 years and you can acquire new house 1 year before sale & upto 2 years from date of sale. If you have any excess money in hand out of sale receipts (CG portion), you have to deposit that money into Bank Account & have to route all transactions through that Account but if you have already spend  whole CG portion in another residental house, no need to deposit.

Sorry wrongly spelled Manish.

Above message is for Garvit too.

Dear Saurabh/Harpreet/ Manish,

As per sec 54F I should not own on the date of transfer of the original asset more than one residential house (other than the new house) where as i own 1 self occupied property and 1 let out property at present. Still I can purchase a new residential house and claim exemption on my capital gain tax......Please advise!!!!

Thanks & regards

Garvit

Originally posted by : Garvit
	Dear Saurabh, As per sec 54F I should not own on the date of transfer of the original asset more than one residential house (other than the new house) where as i own 1 self occupied property and 1 let out property at present. Still I can purchase a new residential house and claim exemption on my capital gain tax......Please advise!!!!   Thanks & regards Garvit

You are not supposed to claim exemption u/s 54f you have to claim exemption u/s 54.

Manish,

My main doubt is -i own 1 self occupied property and 1 let out property at present. Still I can purchase a new residential house and claim exemption on my capital gain tax......Please advise!!!!

Originally posted by : Garvit
	Manish, My main doubt is -i own 1 self occupied property and 1 let out property at present. Still I can purchase a new residential house and claim exemption on my capital gain tax......Please advise!!!!

Yes you can do so.
 

@ Garvit Have you held the asset(house property)  sold for period of atleast 3 years....??

If u Satisfy above condition u can claim Exemption under Sec 54..Else No...

yes, you can purchase new house property to save tax.
enjoy  !!!