• Capital gain tax on selling one flat retaining other

Me and wife purchased two flats in 2002( then 15lakhs. Now 145lakhs)  and in 2009 (67lakhs to 160lakhs) in new bombay and mumbai both in joint names with funding  from both.
We want to sell one flat now...can't we get capital gain tax relaxation  if we invest in another flat now  as it is more than 3 years from purchase of both. Otherwise the capital gain tax will be >22lakhs.
Pl guide...(had posted earlier..but no reply)
Pl. Kumar
Asked 7 years ago in Taxation

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4 Answers


You will be eligible to claim exemption of capital gains arising out of the sale of a flat.

However, please ensure that if you're not going to invest in another house immediately, then deposit the sale consideration into a Capital Gains Account Scheme in any bank. The deposit in the said account has to be made before the due date of filing the return of income (ie 31 July).

Happy to help you further, if need be.



Keerthiga Sharma
Advocate, Greater Mumbai
44 Answers
2 Consultations

5.0 on 5.0

1) you are at liberty to sell one flat

2) since you have held the flat for 3 years it would attract long term capital gains

3) you can reinvest sale proceeds in purchase of another flat to avoid payment of any capital gains tax

4) Section 54 of the income Act provides that if a tax payer invests the sale proceeds received from the sale of any capital asset for buying a residential property; the long-term capital gains on sale of the property would be exempt.

Ajay Sethi
Advocate, Mumbai
95197 Answers
7607 Consultations

5.0 on 5.0

1. You are at liberty to sell one flat. In view of the fact that you have held the flat for 3 years you are eligible to long term capital gains.

2. If you reinvest the sale proceeds to purchase another residential property you would be exempt within the scope of section 54 of IT Act from paying capital gains tax.

Ashish Davessar
Advocate, Jaipur
30763 Answers
972 Consultations

5.0 on 5.0

The Income Tax Act has laid out exemptions under Section 54 and Section 54F to help taxpayers save tax on capital gains.

(1)Exemption under Section 54 is available on long-term Capital Gain on sale of a House Property.

A new residential house property must be purchased or constructed to claim the exemption

The new residential property must be purchased either 1 year before the sale or 2 years after the sale of the property/asset.

Or the new residential house property must be constructed within 3 years of sale of the property/asset

If you are not able to invest the specified amount in the manner stated above before the date of tax filing or 1 year from the date of sale, whichever is earlier, deposit the specified amount in a public sector bank (or other banks as per the Capital Gains Account Scheme, 1988).

Only ONE house property can be purchased or constructed.

T Kalaiselvan
Advocate, Vellore
85398 Answers
2235 Consultations

5.0 on 5.0

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