CA Ankita Karia (CA) (100 Points)
07 November 20131.)Can assessee who has sold his long term house property avail benefit of investment in another house property even if he already owns one house property?
2.) if Assessee has sold his house property in discharge of some liability than what would be the capital gain treatment???
pls note. the entire sale consideration is used to discharge the liability.
Reply asap.
thanks
Ankit
(CA, CS)
(3064 Points)
Replied 07 November 2013
Dear Ankita,
CA Ankita Karia
(CA)
(100 Points)
Replied 07 November 2013
Thanks Ankit.
But if the person doesnt have money, as entire sale consideration is utilised to discharge liabilty, from where shall he pay tax??
Ankit
(CA, CS)
(3064 Points)
Replied 07 November 2013
You are welcome Ankita,
unfortunately, there is no answer to this question…the tax is a statutory liability and has to be discharged.
If the sale proceeds are utilized for the discharge of liability, it becomes application of income and tax has to be paid on the same.
Also, to tell you, if the sale proceeds are over 50 lakhs, the buyer would have deducted TDS on the same….to that extent, your liability will come down.
Ankit
(CA, CS)
(3064 Points)
Replied 07 November 2013
you are welcome...
incase you have any queries...please ask....
CA Ankita Karia
(CA)
(100 Points)
Replied 07 November 2013
suppose the asset is sold in may 13, what are the dates latest by which the capital gain should be invested, whether in bonds or CGAS or investment in another house property??
Thank you
Ankit
(CA, CS)
(3064 Points)
Replied 07 November 2013
the investment should be made on or before the due date of filing of the return.
So, incase the property is sold in May 2013, the AY will be 2014-2015. The investment thus, should be made before 31 july 2014
CA Ankita Karia
(CA)
(100 Points)
Replied 07 November 2013
But as per SEC54 investment in another flat can be made within 2years from date of transfer.
isnt it??
Than y before 31st july??
Ankit
(CA, CS)
(3064 Points)
Replied 07 November 2013
Correct,…but the exemption will be under 54 for you…
54 says as under:
In order to avail the exemption, gains are to be reinvested, before the due date of return u/s 139(1). If the amount is not so reinvested, it is to be deposited on or before that date in account of specified bank/institution and it should be utilised within specified time limit for purchase/construction of new asset.
Hence the investment is to be made either in the new house or in the CG account before 31 jul
Have also sent you a Pvt. Msg…pls Check
CA Ankita Karia
(CA)
(100 Points)
Replied 07 November 2013
how do you define utilisation within specified time limit??
pls correct me if i am wrong,
IF the assesse cannot invest within due date than he should deposit amount in CGAS, & than he can utilise that amount to purchase a flat within 2 yrs from date of transfer.
pls comment
Ankit
(CA, CS)
(3064 Points)
Replied 07 November 2013
Yes you are right
Utilisation means either you purchase the new property or you invest the money in the special capital gains account.
This account can then be utilized to buy the flat.
CA Ankita Karia
(CA)
(100 Points)
Replied 07 November 2013
So that means for now assessee have to now deposit in CGAS account if he doesnt buy another house property before due date & than invest in another house property within 2 yrs from date of transfer
Right ???
Ankit
(CA, CS)
(3064 Points)
Replied 07 November 2013
No…
Till 31 jul 2014, either buy a house…if that is not possible, invest it in CG account..
Nothing to be done now…you have time till 31 jul 2014
CAclubindia
