Problem in capital gain exemption 54f and 54

Tax queries 514 views 2 replies

paras mehta

article assistant

42 Points Joined April 2009

one of our client has sold his long term capital asset long term asset other than a residential property in oct -12 and has got the consideration arnd 1.77 crores and has acquired house of Rs. 2.29 crores in march-12 and thus has claimed exemption u/s 54F, which in all phases satisfy the conditions of 54F...

Now after purchasing the residential house in march 2012 he has again sold A residential property (other than that purchased in Mar-12) in apr-12 and has long term capital gain of Rs. 40 lacs.

So can he claim exemption under section 54 against the long term cap gain of rs. 40 lacs on the sale of the residential property via purchase of the residential house in march-12 having the balance of 52 lacs....(2.29 crores - 1.77 crores).

Replies (2)

Shalaka Chawla

44 Points Joined December 2011

No. The second event is seperate.

GiriRaaj

Articleship Traing

162 Points Joined July 2012

Originally posted by : paras mehta
	one of our client has sold his long term capital asset long term asset other than a residential property in oct -12 and has got the consideration arnd 1.77 crores and has acquired house of Rs. 2.29 crores in march-12 and thus has claimed exemption u/s 54F, which in all phases satisfy the conditions of 54F... Now after purchasing the residential house in march 2012 he has again sold A residential property (other than that purchased in Mar-12) in apr-12 and has long term capital gain of Rs. 40 lacs. So can he claim exemption under section 54 against the long term cap gain of rs. 40 lacs on the sale of the residential property via purchase of the residential house in march-12 having the balance of

Mr. paras mehta you are doing totally wrong calculation of 52 lacs....(2.29 crores - 1.77 crores).

Common rule is that EXEMPTION CANNOT EXCEED the amount of capital gain

in your case u said that your client received rs 1.77 crores as considerstaion then surely his capital gain is less then that , and he will enjoy full exemption when he acquirs new house of 2.29 crpres

now no exemtion is left coz already claimed in 1st case

bt the way s54 gives exemtion when RESIDENTIAL HOSE PROPERTY is bought by SELLING other RESIDENTIAL HOUSE PROPERTY

thanks :)