Applicability of Exemption u/s 54

[DINESH MITTAL]

'A' sold house in India and purchase a new house within stipulated period in Canada, whether he is legible for exemption u/s 54. of the Income Tax Act, 1961

[Dinesh Gupta]

There is no restriction in section 54 of the Income Tax Act, which restrict the investment of capital gain within stipulated period in a house property situated out of India. Therefore you can buy a house in Canada and claim the exemption.

[SUNILKUMAR GUPTA]

Dear friend you can refer to 282 ITR (AT)211 , Mumbai - wHERE IT HAS BEEN HELD SEC.54 DOES NOT PROHIBIT PURCHASE OF PROP. IN A FOREIGN COUNTRY.

AI Summary

Exemption under Section 54 of Income Tax Act applies even when new property is purchased abroad, as per tribunal decision. A person sold a house in India and purchased another in Canada within the required period, seeking exemption under Section 54 of the Income Tax Act, 1961. Two responses affirm that Section 54 does not restrict the purchase of a new property outside India. One response references a Mumbai tribunal decision, supporting the claim that buying property abroad does not disqualify one from the exemption.