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Capital gains in Real estate for NRI

Mahesh zankar (self employed) (25 Points)

17 May 2011

HI,

I am have been a NRI for the past 10 years. I had purchased a property in 2005 through forex remittance. Now I have sold the property this year (2011). I would like to repatriate the funds to my current country of residence to purchase a property here. I believe that there is a total exemption on capital gains tax as I am reinvesting in another property as per a Citation 282 ITR 211 between Mrs. prema shah and Income tax officer. Is this true? If so i am assuming I should be able to repatriate all the funds without paying any taxes in India??? Pls help

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CA. Anuj Gupta (Practices in NRI Int.Tax FEMA TP FDI/FIPB & FCRA) (7024 Points)
Replied 17 May 2011

There has been a contrary decision in tribunal . If I go by intention of legislature then it seems unlikely that government will give tax benifit for purchasing property outside India for capital gains gains arising in India . In my view it is really litigous to avail the benifit under sec. 54 in the similar cases.

Anuj

0-9810106211

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Mahesh zankar (self employed) (25 Points)
Replied 21 May 2011

HI Anuj,

Thanks for the reply. I have been given advice to claim full exemption by my CA and infact he has mentioned the same in the Form 15CB from his side. Moreover when I filed my IT returns this year I have mentioned the sale and claimed exemption under sec.54. Its been over 3 weeks and I haven't heard anything from the IT dept. Do you think I will have a problem with RBI when transfering the funds??? YOur help will be deeply appreciated

CA. Anuj Gupta (Practices in NRI Int.Tax FEMA TP FDI/FIPB & FCRA) (7024 Points)
Replied 21 May 2011

You will not hear so soon from IT dept.Wait till 1.5 years for any notice from Dept. RBI should not have a problem one form 15 CB has been given by CA.

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