Income tax exemption on sale of under construction flat

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  1. S Gupta

    S Gupta New Member


    I need your help in solving my tax query. On 7th April 2011, i had sold my residential house and what ever capital gain I had gained i had invested in one under construction flat and i had claimed benefit u/s 54 in my return. Under construction flat's buyer agreement was signed on 3rd Nov 2010. For under construction flat i had chosen construction link plan and as the construction progressed , i paid to builder. Till Jan 2014, i had paid 95% cost of flat. Now since builder is not giving possession, i want to sell this under constructed flat.

    Question 1 Can i sell this under constructed flat before possession?
    Question 2 If I can sell this under constructed flat , it would be treated sale of house property or sale of right to buy property
    Question 3 This under constructed flat sale would be long term or short term ( I think period of holding would be counted from date of buyer agreement)
    Question4 If i invest the profit of sale of under constructed flat in buying other asset then can i claim benefit u/s 54 (And if claim u/s 54 is not possible can it be claimed u/s 54F

    Sorabh Gupta
    Mob 9818640933
  2. Manoj Mehra

    Manoj Mehra Active Member

    1. Yes, you can sell the under-construction property before possession
    2. It would be considered as sale of right to buy a residential property. However, capital gains treatment would be the same as on sale of a residential house property.
    3. You can claim exemption under Section 54 as well as 54EC
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