Capital gainTax on selling one residential flat out of multiple

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  1. Dear Sir,
    I have noticed in many Q&A forums that capital gain tax can be saved by reinvesting the amount in certain period but that is possible when you own only one residential property at time.
    I have five residential property and I want to sell only one of them. Can I save capital gain tax on this by reinvesting this amount in new fifth residential property.
  2. Shishir Nayak

    Shishir Nayak Member

    The restriction you are talking about is u/s 54F.
    But There is no restriction placed in section 54 which restricts exemption if you own more than one residential property. You can sell and avail exemption u/s 54.

    But Where more than one residential house is purchased out of the sale proceeds of one residential house, exemption u/s 54 can be claimed only in respect of one house, provided the other conditions of Sec 54 are satisfied.[K.C. Kaushik v ITO 185 ITR 499 (Bom.)(1990)]
  3. rudrabose

    rudrabose Active Member

    There is a condition for claiming exemption which says that the amount should be reinvested in another residential property purchased 1 year before or 2 years after the sale of the property.
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