Dear sir, I have purchased a flat for which the allotment letter was provided in Feb 2012. My agreement was signed and registered in Aug 2014. The delay wqas due to change in BMC rules when all registrations of agreements had stopped. I got possession of the apartment in Sept 2016 after my final payment in August 2016. I am planning to sell another flat in Mumbai which I have held for more than 20 yrs. If i sell this house in the month of May 2017, will I be able to get Long term capital gains for the sale under section 54 of IT act, since Im selling within one year of possession. Can you pls clarify which date must be taken for calculating Capital gains tax. Thanks, Pranay
As you have made your final payment and acquired possession of the flat in August 2016 and the proposed sale of the old flat is in May 2017, you are eligible to claim exemption u/s 54/54F, subject to fulfilment of conditions as applicable to you.
The market value of the flat in Mumbai as at 1st April 2001 shall be the cost of acquisition and the indexed cost of acquisition shall be taken on the basis of index, which is yet to be prescribed, for the current financial year.
Dear Sir
No, you will not be eligible for exemption. In order to claim the exemption house should have been bought within 1 year before the date of sale.
In your case you have only taken the possession before 1 year.
House has been purcahsed when you got the allotment letter.
Please feel free to call/revert in case of any doubts
Thanks and Regards
Abhishek Dugar
CA CS B.Com
Sir please clarify whether you are selling the mumbai flat which was held for more than 20 years or you are selling the flat you registered and got possession in 2016.
Hello Pranay,
You cannot set off the Long Term Capital Gains against your other property as the registered date is August 2014.
You can invest the gains in Capital Gain Tax Saving Bonds upto a maximum of Rs.50 Lacs within a time period of 6 months from the date of your sale in order to save up on taxes.
Trust this clarifies your query.
Feel free to call / get back in case of further clarifications.
Thanking You.
Regards,
Rohit R Sharma
BCOM, ACA, LLB-GEN, CERT. FAFP
