long term capital gain tax on sale of plot

Hi pankaj, I have purchased a residential plot (100 sq.yd.) in December 2000 for Rs. 1,00,000 + Rs. 15,500 stamp duty in Faridabad. Current price is Rs. 9,00,000. Now I want to sell this plot in Rs. 9,00,000 and to buy a residential flat in Rs. 15,00,000 in Ghaziabad. Can I avail tax benefit under section 54? If yes, then can I deposit the amount received from plot sell in my saving account before giving payment to builder or I have to open the capital gain account first. Both sell & purchase will happen in June 2012. Also flat is ready for possession. If not, then how much I have to pay the tax? Please clarify.

asked Apr 13 '12 at 15:30 by vks 1111


You can claim tax benefits under section 54F (not 54 because you are selling a plot and not a residential house property).

As new flat purchase cost is more than sale consideration of plot, there won't be any income tax payable.

There are some conditions for 54F applicability:

  1. You should not be owning more than one residential house property at the time of sale of plot.
  2. New flat should not be sold in next three years of possession.
  3. Possession of new flat should be received within two years of sale.
  4. In next three years, total residential house properties owned by you cannot be more than two.

If you receive possession of flat before 31st July 2013 (last date of income tax return filing), there won't be any need of opening capital gain scheme account. You can keep amount in a savings account too.

answered Apr 18 '12 at 17:53 by Pankaj Batra 5.2k320

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Asked: Apr 13 '12 at 15:30

Seen: 1,725 times

Last updated: Apr 18 '12 at 17:53