Section 54F exemption: Observe timelines for selling asset, buying another

Recent judgement emphasises that co-ownership of multiple floors in the same building does not disqualify taxpayer for this exemption under Section 54F

The Delhi High Court recently upheld Lata Goel’s claim for a ₹90 crore exemption under Section 54F of the Income Tax Act for assessment year 2011–12. The exemption was against capital gains from the sale of FIITJEE Ltd shares, which she reinvested in purchasing a new residential house. The assessing officer (AO) opposed the claim, citing ownership of more than one residential property.

 

The AO relied on South Delhi Municipal Corporation records indicating Goel co-owned the basement and second floor of a property in Vasant Vihar, New Delhi, to argue that this disqualified her from being eligible for Section 54F.