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Sec 54 & 54 f

CA Komal N Somaiya (TAX PRACTITIONER) (66 Points)

27 November 2012

MY CLIENT HAS SOLD TWO PROPERTIES

1) A RESIDENTIAL HOUSE PROPERTY (LONG TERM CAPITAL ASSET) AND

2) AGRICULURAL LAND (TAXABLE , NOT FULFILLING CRITERIA, LONG TERM)

DURING THE FY 11-12.

HE HAS INVESTED FULL SALE CONSIDERATION RECEIVED FROM BOTH THE PROPERTIES IN ANOTHER RESIDENTIAL HOUSE.

NOW MY QUESTION IS

WHETHER HE CAN TAKE BENEFIT OF SEC 54 & 54 F SIMULTANEOUSLY , THAT IS

SEC 54 FOR RESIDENTIAL HOUSE TO RESIDENTIAL HOUSE

SEC 54F FOR ANY OTHER PROPERTY TO RESIDENTIAL HOUSE

MY CLIENT HAS NO OTHER RESIDENTIAL HOUSE OTHER THAN NEW PURCHASED

PLEASE PROVIDE MY ANY RULING IF ANY

THANKS IN ADVANCE

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4 Replies

C.A Manish pandey (Associate Consultant@infosys ltd) (287 Points)
Replied 27 November 2012

ONLY ONE BENEFIT TAKEN AT A TIME THAT IS EITHER 54 or 54f

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CA Mangesh Chitale (B. Com. A.C.A. DISA (ICAI) DIRM (ICAI)) (245 Points)
Replied 27 November 2012

Hello Komal ji,

The basic question is whether exemption u/s 54 & u/s 54f on the same property is admissible or not ? There is nothing in the Act that prohibits claim under section 54 & 54F simultaneously. In fact,conditions under both the section is different and therefore both these provisions are for different situation. Hence,if conditions of the said provisions are fulfilled,claim of exemption shall lie even if only one property is purchased to claim the LTCG arisen on sale of different assets.It is settled principal that section 54 & 54F are relief mechanism and therefore,if the conditions are fulfilled,the exemptions are allowable.There is no bar in section 54 or in section 54F against claiming exemption for time for the same property if the cost of the property is within the limit arisen to the assessee.

Reliance may be placed on the judgment in the case of Anagha Ajit Patenkar v ITO (2006) 9 SOT 685 (Mum).

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