Treatment of capital gain arising from agriculture LAnd

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What is impact of capital gain arising from sale of agriculture land situated in urban area? Is there any provision for exeption or tax saving?
Replies (6)

U can go for 54EC & 54F

Yes 

there is provision for exemtion for long term capital gain only

Mr.Nikunj and Mr.Dhiroj

On complying the provisions of   section 54B you can avail exemption.

Best Wishes

Sathikonda

Read Section 54B

 

(ii) Capital Gains on transfer of agricultural land [Section 54B]

This section provides for exemption from tax in respect of capital gains arising from the

transfer of any land situated in municipal or other urban areas in certain cases.

In order to avail of this exemption (i) the capital asset being land situated within the municipal

or other urban areas, must have been used by the assessee or his parents for agricultural

purpose during the two years immediately preceding the date of its transfer; and (ii) the

assessee must acquire, within a period of two years from the date of transfer, any other land

in the same or other area for being used by him or his parent for agricultural purpose.

This exemption corresponds to the exemption in respect of capital gains arising from the

transfer of residential house available under section 55 and is intended to remove the

hardship that may be caused to bona fide agriculturists who have to sell or otherwise transfer

agricultural land within such limits. The other provisions regarding the treatment of capital

gains arising in respect of the new asset or its transfer within a period of three years of its

purchase are similar to those discussed earlier under section 45.

The note appended to section 54 regarding Capital Gains Accounts Scheme, 1988 is

applicable to section 54B also. Sub-section (2) of section 54B deals with such a scheme.

Mr.Nikunj..

you can go for 54F, 54EC and 54B.... 


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