TaxTMI 
TaxTMI 
Applicability of Capital Gain on alteration of new house like interiors and furniture
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....pplicability of Capital Gain on alteration of new house like interiors and furniture<br> Query (Issue) Started By: - Venkatesh Dhongadi Dated:- 9-6-2026 Last Reply Date:- 9-6-2026 Income Tax<br>Got 1 Reply<br>Income Tax<br>Assessee got a share from Sale proceeds of a open land and during the same year a new house was allotted from a share in Joint venture agreement of another land. Assessee invest....
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....ed the amount received from sale proceeds of a open land in the alteration of new house like interiors and furniture which was allotted though joint venture agreement which is Self-occupied. Now my query is whether the assessee can claim deduction u/s 54F of income tax act, for amount invested in alteration of new house like interiors and furniture on Sale proceeds of a open land? Reply By YAGA....
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....Y andSUN: The Reply: On the settled legal position, a claim under Section 54F is generally available when the net consideration from the transfer of a long-term capital asset (other than a residential house) is invested in the purchase or construction of a residential house within the prescribed time limits. The exemption is linked to investment in the residential house itself. Expenditure incur....
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....red on substantial completion, improvement, renovation, modification, or interior works that form an integral part of making the residential house habitable may, depending on the facts, be considered as part of the cost of construction/improvement of the residential house. However, the assessee must be able to demonstrate that the expenditure was incurred on the residential house and is directly c....
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....onnected with its construction, completion, or permanent improvement. In contrast, expenditure on movable items such as furniture, loose furnishings, appliances, de cor items, and other detachable assets is generally not regarded as investment in the purchase or construction of a residential house for purposes of Section 54F. Therefore, amounts spent on furniture would ordinarily not qualify fo....
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....r exemption under Section 54F. If the new house was received pursuant to a joint development/joint venture arrangement and the sale proceeds were subsequently used for permanent interior works, civil alterations, fixtures, electrical works, flooring, false ceiling, modular units fixed to the building, etc., a stronger case may exist for treating such expenditure as investment in the residential ho....
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....use, subject to evidence and timing requirements. The eligibility will ultimately depend on the nature of the work, supporting documents, and whether the expenditure can be characterized as part of the residential house rather than acquisition of separate movable assets.<br> Discussion Forum - Knowledge Sharing ....