I have a doubt in capital gains please help!' in Exemptions-Section 54D .. i understood everything but didnt get the treatment of enhanced compensation. In a question, the assessee received d 'original/initial compensation' (and den he is supposed to purchase land/building within 3 years) so he did purchase an industrial plot after receiving d initial comp. also he filed to court to increase the compensation. purchase of land (rs. 220000) from initial comp, capital gains came around 160000. so Capital Gains --> NIL . okay. (so on 50000 he didnt get exemption since there were no gains only) But now after all this, next year he received 100000 as enhanced compensation! now this he is supposed to deposit in Capital Gains Scheme Account nd invest within 3 years from d date of receiving this amount,else d amount will be taxed if it ll be unused. My doubt is that why again he shud invest if he has already invested? why shudnt d 50000 (earlier puchase amt not exempted) shud set off from this capital gain ???
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Capital gains doubt
Dear Karishma,
You cant ask why 50K cant be set-off. Law & Logic are 2 seperate issues. the act is silent wrt exemption in case of enhanced compensation. to the best of knowledge it would be suggested to invest in NHAI or REC Bonds. Interesst received will be @ 6% and the interest income will be chargeable to tax. Further the lock in period is for 3 years.
okay :P i thought so! logic is to be kept aside !
okok
now please tell me if u know wat treatment to give for enhanced comp??
wat if enhanced comp is recvd in d same year of receiving d original com?
MOST IMP : is it that nothing can be setted off from enhanced compensation???
i guess yes :/ coz law is really silent about enhanced compensation. Too silent :\
the thing is dat aftr receiving enhanced comp (which is after investment frm original comp) , the assessee will hav to invest again from dat enhanced comp to get the exemption ! so i though dats wierd
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