I have sold my house to a builder in exchange for a new house in a different building. There was no exchange of money or cash in the transaction. Am I eligible for benefits?
I have sold my house to a builder in exchange for a new house in a different building. There was no exchange of money or cash in the transaction. Am I eligible for benefits?
Yes. The word ‘purchase’ in section
54 ordinarily means buying for a price or equivalent of price by payment in
kind or adjustment towards an old debt or for other monetary consideration.
There is no stress in the section on ‘cash and carry’.
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 ...
Yes. If you have held the asset beyond a period of five years, you are eligible to claim benefits even though the depreciation on the same was claimed by you. This view is supported by numerous decisions of higher judiciary.
Yes. As per CBDT Circular 667 (dated 18.10.1993), the cost of the plot purchased for construction of a new house can be included for computation of benefits u/s 54 of the Act.
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.
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.