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Capital Gain on transfer of Residential Property - (New) Section 82 / (Old) Section 54
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....er the head "Income from House Property." New Asset [ Section 82(1), (5) & (7) ] The assessee must: • Purchase one residential house in India within: • 1 year before transfer, or • 2 years after transfer; or • Construct one residential house in India within 3 years after transfer. • If the capital gains does not exceed two crore rupees, the assessee may, at his option, purchase or construct two residential houses in India. • If during any tax year, the assessee has exercised the such option, he shall not be entitled to exercise such option for the same tax year or any other tax year. • Maximum Investment Ceiling of Rs.10 Crore for Exemption. ....
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....ees shall considered for the for deposit and exemption purposes. Deemed Cost of New Asset [ Section 82(3) ] For the purposes of sub-section (1), the amount, already utilised for purchasing or constructing the new asset, together with the deposited amount under sub-section (2) shall, subject to sub-section (7), be deemed to be the cost of the new asset. Formula Cost of New Asset = the amount, already utilised for purchasing or constructing the new asset + Deposit amount in to Capital Gain Deposit Account (Subject to condition) Under Section 54 of the Income Tax Act, 1961 [Upto 31.03.2026 ] Applicability It applies when: • The assessee is: • An Individual, or ....
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....l gain exceeds Rs. 2 Crore • Where the amount of capital gain exceeds Rs. 2 crore, One Residential House in India should be - • Purchase with in 1 year before 2 year after the date of transfer or • Constructed within a period of 3 year after the date of transfer Where the amount of capital gain does not exceeds Rs. 2 Crore • Where the amount of capital gain does not exceeds Rs. 2 crore, the assessee i.e. Individual or HUF, May at his option • Purchase Two Residential House in India with in 1 year before 2 year after the date of transfer or • Constructed Two Residential House in India within a period of 3 year after th....
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....Therefore, now the exemption can be claimed for purchase/construction of 2 RHP instead of 1. This benefit is available only when the capital gain does not exceed Rs. 2 Crore. Further, this benefit is available only once in a life time. • Its means the maximum exemption that can be claimed by the assessee u/s 54 is Rs. 10 crore. Important Circular and Notification • Investment in a flat allotted under the Self financing Scheme of the Delhi Development Authority is to be treated as construction for capital gains exemption purposes because the allottee obtains title on issuance of the allotment letter, the DDA performs construction on behalf of the allottee, instalment payments a....