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When Does A Transfer Take Place In An Agreement For Sale Of Immovable Property For Capital Gains Purposes?

QUERY: ‘P’ had to sold her property in order to finance her daughter’s medical expenses.

The agreement for sale was entered for Rs. 50/- lakh. She received only Rs. 35/- lakh due to dispute with the buyer. No possession of the property was given. She does not have money to invest in order to claim exemption u/s. 54. The AO passed the order levying tax on Rs. 50/- lakh. Whether AO is right?
ANSWER: Click here to read the full answer of the expert

In this case transfer is not complete, because of property has not been given and therefore there is no question of investing in another house to claim exemption under section 54

Posted in Income-tax