I would like to invest one part of my long capital gains arising out of sale of my house property in purchasing another house property and the remaining part in the government bonds. Please let me know if this is possible and allowed as per IT laws
1 Replies
Sathish Karunakaran
(ACA)
(614 Points)
Replied 19 October 2008
Yes, you can claim exemptions from long term capital gains [LTCG] under more than one provisions. Like Investing in new residential property and specified bonds U/s. 54EC.
If cost of new property exceeds your LTCG, there is no tax. But if cost is below to LTCG, the exemption is restricted to the cost of new property. - Sec. 54
You cannot invest in government bonds to claim exemption from LTCG, it is only the specified bonds U/s. 54EC that you have to invest. i.e 3 years Bonds from NHAI, Rural Electrification Corporation
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