TaxTMI 
TaxTMI 
Mr. X has sold immovable property after claiming depreciation and earned short term capital gain. The asset was purchased long time before and was long term by nature as it was held for more then 36 months. Now can Mr.x invest in securities mentioned U/s 54EC and Exempt capital gain? Pls inform there is any case law?
Exemption of capital gain - investment in securities
02 Jan 2010 
3 Replies 
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Deemed short-term capital gains may preclude reinvestment exemption in specified bonds, though analogous case suggests possible exception.
Whether a taxpayer who sold a depreciable immovable and claimed depreciation can claim reinvestment exemption under section 54EC depends on the deeming effect of section 50 treating gains as short term, potentially precluding exemption; a cited High Court decision on an analogous reinvestment provision suggests exemption may still be available where reinvestment conditions are met. (AI Summary)
Whether a taxpayer who sold a depreciable immovable and claimed depreciation can claim reinvestment exemption under section 54EC depends on the deeming effect of section 50 treating gains as short term, potentially precluding exemption; a cited High Court decision on an analogous reinvestment provision suggests exemption may still be available where reinvestment conditions are met. (AI Summary)