LTCG from sale of Land

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  1. rtiku

    rtiku New Member

    Dear Sir,

    Require advise on the following.

    Had purchased a land piece in 2011.
    Sold the same in July 2015.
    The net sale value was 10Lakhs and the LTCG (after considering indexation) is 5L.

    Please advise for:
    1. Do I have to invest 5L or 10L for purchase of residential property for avoiding payment of LTCG tax
    2. Since I have to open a Capital Gain account before 31/07/2016, do I have to put in the entire sale amount (10L) or only the Capital gain amount (5L) into the account.
    2. If I purchase a under construction property, does the registration need to be carried out within 2yrs (July 2017) or the possession has to be completed.
    3. In case the property purchased is say 20Lakhs and by July 2017 I pay 5L/ 10L to buider but construction is still not over, will that serve the purpose.
    4. In case I decide not to invest further, I can pay the tax on capital gain amount by July 2017 or earlier. And will I be liable to pay some penalty on the tax amount.

    Your response will be really appreciated.


  2. Karan Batra

    Karan Batra Well-Known Member

    Section 54F would be applicable in this case.

    Answers to your queries keeping Section 54F in mind are as follows
    1. You'll have to invest Rs. 10 Lakhs
    2. You'll have to deposit Rs. 10 Lakhs in Cap Gains Account
    3. .
    4. You'll have to pay tax on the amount not invested. No penalty would be levied in this case
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