Section 54EC: Capital Gain on transfer of any Long Term Capital Assets

Exemption is Allowed provided the Assessee has long term Capital Gains on transfer of any long term Capital Asset (being land or building or both w.e.f   A.Y 2019-20)

Section 54EC: Capital Gain on transfer of any Long Term Capital Assets

Conditions:

  • The taxpayer should be any assesses.
  • Assets Sold should be long term.
  • Investment should be made In NHAI bond or RECL bond, redeemable after 5 year.
  • Investment should be made within 6 months from the date of transfer.
  • Investment in Specified Unit Should not exceed 50 lakh during the current year and succeeding financial year.

ADDITIONAL CONDITIONS

  1. If new asset is sold within 5 years amount earlier exempted under this section will be reduced from its COA to calculate capital gains thereon.
  2. If a loan is taken on the security of the new specified asset within 3/5 years, the same will be treated as capital gains.
  3. Investment in specified bonds should not exceed Rs. 50 lakhs during the current and succeeding financial Year.
  4. The Assesee is not allowed to convert the Security into Cash. Means The Assessee is not allowed to take Loan on the basis of security.

                                

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