Can assessee claim exemption under section 54 in respect of purchase of TWO resedential house from capital gain arising from sale of ONE resedential house????
12 Replies
Sunshine
(Helping All)
(10575 Points)
Replied 25 December 2010
yes he can take the exemption.........
ANKUR KUMAR
(CA-FINAL)
(39 Points)
Replied 25 December 2010
In my view
Section 54 provides for the purchase of Single house from the capital gain proceeds from the sale of residential unit.
However if on that purchased reidential house one more additional floor is being constructed then cost on such additional floor will also be allowed as exemption.
CA PARAS BAFNA
(Practising CA )
(33428 Points)
Replied 25 December 2010
PLEASE REFER THE DISCUSSION HELD EARLIER -
/forum/details.asp?mod_id=80254&offset=1
CA Nikhilesh Singla
(CA)
(83 Points)
Replied 26 December 2010
yes assessee can claim exemption under section 54 for purchasing 2 houses nd by selling 1 house but exemption will be granted upto the limit of amount of capital gain because there is no limit is given under section 54 regarding purchases of houses......
U S Sharma
(glidor@gmail.com)
(21063 Points)
Replied 26 December 2010
| Originally posted by : Nikhil | ||
 |
Can assessee claim exemption under section 54 in respect of purchase of TWO resedential house from capital gain arising from sale of ONE resedential house???? |
 |
the exemption is limited to self occupied ONE unit in one city, however if u procure 2nd unit in another city, then allowed, otherwise not.
CA Karan Lodhi
(CA and B.com(hons.))
(879 Points)
Replied 26 December 2010
According to the judgement given by Bombay High Court in the case of K.C. Kaushik Exemption under section 54 is available for only 1 residential house purchased by money arising out of long term capital gains by transfer of residential house..If assessee buys more than 1 house then exemption will be limited to only 1 house at the option of assessee (for anyone house)
CA Sandeep Kumar
(Audit Assistant)
(804 Points)
Replied 26 December 2010
I do not agree with Karan.
Please refer to HC decision, CIT Vs D Ananda Basappa (2009) 309 ITR 329 (Kar HC)
Held: Exemption is available even if more than one residential house is purchased, such restriction is only w.r.t section 54F, and not section 54.
PLease note that KC Kaushik case was decided by ITO, in Bombay, where as Ananda Basappa case is a HC decision. I am aware of the fact that any decision from HC/tribunal/CIT/ITO are binding only on their jurisdiction, such decisions are neither binding nor a precedence for any other authority for ariving at a decision, except for their jurisdiction.
However more weightage may be given to HC decision by another HC, no compulsion though. It is also to be noted that there is no SC decision on this matter. Going by the intention of law makers, investing on more than one property should be available for exemption. If ivesting on one property is itself allowed as exemption, why not on another property cannot be allowed??? Impossible for an assessee to find a property which is of same cost as that of capital gain.
sudha
(housewife)
(32 Points)
Replied 27 December 2010
please guide me which is the finanical year and ass year
i have sold property on feb 2008 and site purchased on march 2008 and start constructing and will be finishing in jan 2011 if the capital gain comes it should be assessed in which year
CA Nikhilesh Singla
(CA)
(83 Points)
Replied 27 December 2010
you can take exemption in P/Y 08-09 because tumne 08-09 ke year mai apni property ko sell kiya tha or ussi year mai 1 or purchase kr liya tha..
binita kumari
(student)
(23 Points)
Replied 28 December 2010
As per my opinion ,
"If an assessee has purchased two or more house within time prescribed in sec 54 of income tax act , he/she can claim only one house for exemption. "
kishore choudhury
(article asst.)
(114 Points)
Replied 28 December 2010
As per section 54 , it is silent regarding the investment in number of houses.so as per the decisions available,we can invest in more than one house.
Recent Topics
- ITC Eligibility on GTA
- Top Highest Tax-Paying Celebrities: FY 2023-24
- Misplace society Bye law
- Submit ommited invoice of previous year
- Need your valueble insight
- GSTR-9 Invoices
- Agricultural Business Loss
- Reporting in gstr9 of ITC of Previous year reverse
- Tax on Reimbursement of House Rent
- MAHARASHTRA CHARITY COMMISSIONER WEBSITE
Related Threads
CAclubindia
