Can I include the cost of the plot on which I am constructing a new house in computing exemption benefits?

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• I have sold my residential house and invested the entire proceeds in purchase of a new house from a builder for which an agreement to sale is registered. However, the builder has not given possession of the flat. Am I eligible for benefits?

  Yes. The key condition is utilization of sale proceeds for investment in a new residential house. If you could demonstrate that the delayed possession is beyond your control and you have paid substantial amounts to the builder, you are eligible for ...

• Is the exemption valid in case of residential house purchased outside India?

  No. The section specifically mentions that the new asset being a residential house must be acquired in India.

• What is the time limit for purchase of a new residential house from the time of sale of original house?

  In order to be eligible for the benefit under this section the NEW house must be purchased within a period of ONE year BEFORE or TWO years AFTER the sale of original asset.

• What is the time limit for construction of a new residential house from the time of sale of original house?

  In order to be eligible for the benefit under this section the NEW house must be constructed within a period of THREE years AFTER the sale of original asset.

• I have demolished my old residential house and given the plot for development to a developer to construct a residential complex out of which I will receive some apartments. Am I eligible for exemption?

  No. Since you have demolished the building yourself and what you sold is actually your rights in the land, you may not be eligible for benefits under section 54 of the Act.