lina abood (bussiness) 09 February 2012

Cpital gain

DEAR SIR,

I JUST WANT TO KNOW IN CASE I AM HAVING THREE FLAT (ALL LONG TERM) AND I WANT TO SELL TWO OF IT TO INVEST ALL THE AMOUNT IN ONE NEW FLAT.

BY DOING THAT DO I HAVE TO PAY ANY CAPITAL GAIN TAX.

PLEASE LET ME KNOW

THANK YOU ALL

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adv. rajeev ( rajoo ) (practicing advocate) 10 February 2012

if you have invested in purchasing the property you will get exemption.

Vineet (Director) 11 February 2012

Yes, you can claim exemption u/s 54 if the gross capital gains arising from sale of both flats is invested in new flat subject to other conditions being fulfilled.

There have been disputes by department in this regard by narrow interpetation of word "a" appearing in the section with regards to both sold and purchased residential property. However, mostly the matter has been decided in favour of assessee. Recently ITAT decided that the word "a house" should be read as plural in view of General Clauses Act.

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