Exemption for more than one house available if purchased prior to 1-4-2015

Exemption for more than one house available if purchased prior to 1-4-2015



Ravi Shankar v. Asstt. CIT

Decision:    In assessee’s favour.

Capital gains–Deduction under section 54–Prior to amendment as on 1-4-2015–Limit on number of residential property


AO observed that the assessee had during the year under consideration sold his residential property. And the long-term capital gain shown by the assessee on the sale of the aforesaid property was claimed. As exempt under section 54. AO being of the view that as the claim of deduction under section 54 was allowed. For purchase of one residential house only, therefore, called upon the assessee to justify the deduction claimed by him in respect of purchase of the two properties. The assessee in his reply submitted that both of the new houses purchased by him were meant for his self occupation. AO declined to accept the aforesaid claim of the assessee and restricted his entitlement towards claim of deduction under section 54 only in respect of one residential property.


Amendment make to section 54 was effective from 1-4-2015, which thus made it clear that prior to the say amendment the assessee was entitle the claim deduction in respect of investments make in more than one residential house. As prior to assessment year 2015-16 no restriction was place by the legislature. In respect of investments in the residential houses that an assessee could make. For claiming deduction under section 54. Therefore, claim of deduction raise by the assessee u/s 54 in respect of investment make towards purchase of two residential houses was well in order and to be allow.


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