rahul rana (CA) (110 Points)
17 July 20221. can i claim capital gain exemption under section 54f on transfer of multiple industrial plots to buy one residential house property?
Dhirajlal Rambhia
(SEO Sai Gr. Hosp.)
(177762 Points)
Replied 17 July 2022
Yes, of course,,,, it can be....
rahul rana
(CA)
(110 Points)
Replied 17 July 2022
Dhirajlal Rambhia
(SEO Sai Gr. Hosp.)
(177762 Points)
Replied 17 July 2022
20% is your gain margin.
If invested 50L u/s. 54EC.... equivalent to 2.50 Cr. sales consideration.
So for sec. 54F you have to invest 7.50 Cr for 100% deduction.
Dhirajlal Rambhia
(SEO Sai Gr. Hosp.)
(177762 Points)
Replied 18 July 2022
A quiz for mind....
Suppose He had invested Rs. 50 lakhs in Sec. 54EC bonds...
& purchased a house property for Rs. 4 Crs. to claim deduction u/s. 54F.
What will be his tax liability?
Ans. 14 lakhs + surcharge + cess
rahul rana
(CA)
(110 Points)
Replied 18 July 2022
Sir, can we claim interest paid on home loan as cost of improvement. if yes, then how can we apply indexation of interest amount as total interest relates to different years.
Dhirajlal Rambhia
(SEO Sai Gr. Hosp.)
(177762 Points)
Replied 18 July 2022
Its controversial issue. Few case laws are in support of claiming interest as COI, but in general AO would not allow. There is no clarity in act, so no guaranty that you also get same result.
Natural justice says, its the cost incurred by assessee when he paid only margin money and not full amount initially. So while taking indexation on COA, whether he will choose the agreement date or date on which he fully repaid his home loan. If first agreement date, he cannot take advantage of deduction of interest, as the principal amount he could not pay on first date.
Indirectly it harms the assessee who paid full amount initially.
rahul rana
(CA)
(110 Points)
Replied 18 July 2022
Dhirajlal Rambhia
(SEO Sai Gr. Hosp.)
(177762 Points)
Replied 18 July 2022
In general, allotment letter is taken as date of acquisition, while registered sale deed value is taken as COA. No need of segregating or adding interest part.
rahul rana
(CA)
(110 Points)
Replied 19 July 2022
Sir, Can we take construction extension fees & penal interest on late payment of installments to land authority as Cost of improvement.
Dhirajlal Rambhia
(SEO Sai Gr. Hosp.)
(177762 Points)
Replied 19 July 2022
Construction extension fees can be considered, but none of the penalty, be it additional interest.
Dhirajlal Rambhia
(SEO Sai Gr. Hosp.)
(177762 Points)
Replied 19 July 2022
Construction extension fees can be considered, but none of the penalty, be it additional interest.
rahul rana
(CA)
(110 Points)
Replied 22 July 2022
Sir, i need your guidance for below case
My client has capital gain against two industrial plot Rs.3.5 Cr. (net receipt 7 cr.) & there is LTCL on sale of one residential plot Rs.10Lakh (Net receipt Rs. 1 Cr.). for taking 100% exemption under section 54 F how much amount we need to deposit in CAGS account.
My cleint wants to deposit 7 cr only In that case how we should approach to get the maximum benefit..
CAclubindia
