I understand the Long Term Capital gain from selling house can be invsted in 54EC bonds within 6 months to avoid taxes. I also heard about a provision called Capital Gain Savings Account can be opened to explore the possiblity of investment like new house etc and can be parked there for 3 years. Assuming I park the money in the Capital Gain Savings account and after a year I don't find properrty can I be allowed to invest the amount in 54 EC bond and allowed to claim excemptio?.
Investment in bonds u/s 54EC can be made to save tax on Long term cap gain arising on sale of any asset other than Res. House prop..... but the investment u/s 54EC is to be made within 6 months of sale ......so in your case if you have parked your funds in Cap Gain A/c Scheme,1988 for an year and thinking to route that money to 54EC bonds , then such routing is not permissible u/s 54EC ......Further the Amt parked in Cap Gain A/c scheme will become taxable if you are withdrawing them for any purpose other than for for investment in Res House prop u/s 54..
So its better to utilise that money for purchasing Res HP within 3 yrs of sale....
Thanks
@ saurabh.
Condition for 54EC is transfer of any long term capital assets , so if residential property is long term capital assets dn i can invest in 54EC bonds.
pls clarify.
@ saurabh
Condition for 54EC is only transfer of any LTC assets. so if residential property is LTCA dn i can invest in 54EC bonds.
Thx
No, SEc 5EC exemption is not available for transfer of Res HP.
@ Saurabh,
pls go through I T Act once. Sec. 54EC is not available only for deemed capital gain which take place on liquidation of company . sec. 54EC is available for LT Res. Property...
Thx
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