Dear Sir,
I am a non-resident Indian. Four years ago I bought an apartment in Kerala for Rs 35 lakhs on bank loan. Now I bought a villa in Kerala (again on bank loan) and hence I am planning to sell off the flat for Rs 45 lakhs. Do I have to pay income tax for the capital appreciation (Rs 10 lakhs) if I partially foreclose my new mortgage with this amount? Do I have to fulfill any formalities to get income tax exemption for this amount?
Thanks
regards
Soman
Asked on 11/13/10, 5:00 am
1 Answer from Attorneys
Shrichand Nahar
S.V.Nahar, Advocate
If you are utilizing more than 10 Lacs out of sale of apartment for purchase of villa and if you fulfill conditions of section 54 of the Income Tax Act, then you won't be liable for any capital gains tax on the surplus of sale of apartment.
Answered on 11/13/10, 9:21 pm
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