| Question And Answer | |
|---|---|
| Subject: | Stamp Duty + Brokerage deduction allowed in Sec 54F |
| Category: | Income-Tax |
| Querist: | Puneet |
| Answered by: | Law Intern |
| Tags: | cost of acquisition, section 54 deduction |
| Date: | September 1, 2025 |
Hi,
i want to know whether Brokerage, Stamp Duty cost is allowed in section 54F Deduction ? This is regarding buying residential property and i want to include Brokerage + Stamp duty in cost of acquisition.
Yes. Stamp duty and registration fees are mandatory costs for transferring ownership of immovable property and are explicitly includible in the cost of acquisition for Section 54F purposes.
In C.Aryama Sundaram Vs.The Commissioner of Income Tax-3, (2018) 407 ITR 1/ 258 the Madras High Court held as follows:
“20. What has to be adjusted and/or set off against the capital gain is, the cost of the residential house that is purchased or constructed. Section 54(1) of the said Act is specific and clear. It is the cost of the new residential house and not just the cost of construction of the new residential house, which is to be adjusted. The cost of the new residential house would necessarily include the cost of the land, the cost of materials used in the construction, the cost of labour and any other cost relatable to the acquisition and/or construction of the residential house.”