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Mrs . Shanta Rani (Housewife)     31 January 2012

Will it be short or long term capital gain

Dear Experts,

Question regarding Capital Gain – Will it be termed short term capital gain or long term?

I have recently inherited (my Grandfather built) 2 floors of a lease hold property. Though the property is more than 25 years old, I have inherited (tranfered in my name) it only 6 months ago. I now plan to sell 1 floor of this house and with the available amount, within the next few months; I propose to buy a flat for self occupation.

I am likely to still have some amount in my hand after purchasing this new house.

My questions are:

Will it attract Short term or Long term capital gain?

Will the capital gain be applicable on transaction (1 floor) amount or will be on complete value irrespective of have only sold part i.e. 1 floor and retained 1?

How can I save on Capital Gain tax while keeping the transaction in cheque?

Thanxs in Anticipation




 4 Replies

A V Vishal (Advocate)     31 January 2012

It is a long term capital gainsm however, in absence of other details it is difficult to advise on the taxes and investment to be made etc...

Mrs . Shanta Rani (Housewife)     01 February 2012

Thank you for your prompt reply Mr Vishal,

As desired, Please note the following:

The sale amount is likely to be around 2.75 cr and the value of new flat is around 1.5 cr. both include the amount paid for registeration.

The sale could take place in march 2012 0r maybe may2012 and the purchase would be within the next 6 months.

What is your suggestion?



Vineet (Director)     20 February 2012

for computation of capital gains, the cost of property in hands of your grandfather in 86-87 is also required.

Sagar Tilak (PROPRIETOR)     17 May 2012

It is a sale of property passed on by modes mentioned u/s 49(1) of Income Tax Act.

While calculating period of holding, the period of holding of the earlier owners shall also be considered. Hence in your case, its a Long Term Capital Asset.

Further capital gain will be attracted only for the floor which you are selling. You can enjoy 54 benefit as well.

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