Ltcg exemption on sale of industrial land
Querist :
Anonymous
(Querist) 14 December 2025
This query is : Resolved
We sold industrial land and building . To get exemption on LTCG should we buy industrial land only or any residential property is sufficient. If residential property is ok will it be in the name of partners only. Can we take three years time after the sale
T. Kalaiselvan, Advocate
(Expert) 15 December 2025
Buying residential property will not give LTCG exemption to a partnership firm even if bought in partners' names.
Section 54D of the income tax act apply only if industrial land/building was compulsorily acquired by government. You may then reinvest in new industrial land/building.
Investment must be on the firm's name, buying in the names of partners break the exemption.
kavksatyanarayana
(Expert) 15 December 2025
Yes, a partnership firm in India can purchase industrial land, as property acquired for business purposes becomes firm property under the Indian Partnership Act, 1932, but it must be for the firm's business use, recorded properly, and follow legal steps. The capital gains are reinvested in acquiring other land or buildings for industrial purposes within 3 years, then an exemption will be given.
Dr. J C Vashista
(Expert) 19 December 2025
Very well analysed, opined and advised by learned senior experts.
