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Apul Choudhary (Business Development)     10 December 2013

Long term capital gain

Dear Experts,

a) I sold a plot of land in Dec 2011  which was with me for over 7 years.

b) The total proceeds from the sale were deposited in Capital Gains a/c within 6 months

c) My father sold a residential house in Mar 2012 which was with him for over 15 years. 

d) He deposited the Capital gains after adjusting the indexation in Capital Gains a/c.

e) Now we intend buying a residential house.

f) QUESTION 1: Can he transfer his money (without any tax liability) to me to help me buy a residential house in my single name or is it advisable to buy a Single property in Joint name to benefit from the provisions under Long Term Capital Gains 

g) Question 2: Can we buy an under-construction apartment where we shall pay all the money from Capital Gains account (including interest accrued over last 18-20 months) within THREE years from the date of sale of the respective properties. 

h) Question 3: Though It is also possible that we may NOT get the possession of the said new apartment within the prescribed time line of three years (given that no builder is completing on time).

Will there be any negative impact on LTCG benefit in such a scenario.

i) Question 4: Can I book a property where I know from the beginning that the possession is outside the period of prescribed three years BUT all the money from Capital Gains A/c is paid to the builder much before three years timeline.

Sincerely appreciate your patience to advice on all the above points.

best regards


 1 Replies

Vineet (Director)     12 December 2013

Query 1 : No, property has to be purchased in joint names with identified share to claim exemption u/s 54F in your name and U/s 54 in your father's name.

Query 2, 3 and 4 : Please buy under construction property immediately and get it registered by end of Decembr 2013, i.e. within two years of date of sale of plot. There is no bar in investment in under construction group housing flat for claiming exemption as held by various high courts. Posession may come later.

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