Opinion Of Eminent Legal Luminaries On Controversial Issues

Capital gains – Profit on sale of property used for residence -Exemption – Sale of Residential House.

QUERY: ‘A’ has two residential house (let out) in Mumbai and one residential house (self occupation) in Chennai. Now ‘A’ wants to purchase one residential house in Chennai, out of sale proceeds of one houses in Mumbai out of two residential houses. Whether ‘A’ will get section 54 exemption or not?
ANSWER: It is not clear from the fact, whether the 'A' wants to dispose of the Chennai’s residential house and one house of Bombay and then buy one house in Chennai? If yes, ‘A’ is entitled to get the benefit of section 54.
If not then, ‘A’ is not entitle to get benefit even under section 54F, as on the date of purchase of new asset, he owns more than one residential house, irrespective of whether self-occupied or rented.
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