Question And Answer
Subject: Does purchase of new asset and renovation considered as construction of new residential under 54f
Querist: Madhu
Answered by:
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Date: October 20, 2022
Query asked by Madhu

Capital gains from a sale are deposited in capital gain’s account scheme and two years have passed from transaction date. Can I purchase an existing old home and renovate within 3 years, still claim 54f exemption? Will this be considered as construction of new residential house which gives 3 year time for this?

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The Hon’ble Income-tax Appellate Tribunal in the case of Juveria Begum and others vs ITO ITA 2224/Hyd/2018 dated September 04, 2020 (Hyd)(Trib) has held that renovation of house property can be considered as construction of house property for the purpose of section 54/54F of the Act.

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