You have mentioned that he sold one of the properties. You need to let us know whether it is residential property. Also let us know date of purchase and cost of original property purchase. He is not likely to get benefit of investment in another property because he was required to invest the amount in Capital Gain Scheme A/c of Nationalised bank before 31st July 2015 and make investment for purchase of new house from that account. Nevertheless, 15 Lakhs minus cost of purchase of property will not be his capital gains as he may get the benefit of Cost Inflation Index based on the date of purchase. He can still file the return for 31-03-15 and no need to show in Income Declaration Scheme unless this property and some other properties purchased out of income not disclosed to tax authorities.
Declaration of Income
Hi My Father doesn't have any source of Income from last 10 years and Doesn't have Form 16 as well. In 2014 October , he sold one of his properties and received the Amount in his Bank account through Cheque. The amount was INR 15 Lakh. There was no ITR filed for it. He is now investing it in some other property, out of which 5 lakhs have been invested already and 10 Lakh remain in the account. My questions are as follows- 1. Does he need to Declare INR 15 lakhs now? 2. If yes, then Will it come under the Income Declaration Act 2016, IDS. his understanding was that If it is invested within 2 years, then he doesnt need to pay any taxes on it, therefore no need of declaration. Is it True? Can you help Clearing it.
Dear Sir,
My advice to you is immediately file the belated return showing this transaction under capital gain. Further, in order to get the exemption from paying capital gain taxes, you should have deposited the amount of capital gain into CGDS account with the bank. Then only, you can invest the amount in purchasing new residential property within 2 years.
We can help you in filing return of income. Please feel free to contact us at
Please feel free to call/ revert in case of any doubts
Thanks and Regards
Abhishek Dugar
CA CS B.Com
Residential Plot was purchased in the year 1986 for INR 16000. Please correct me If i am wrong here, As per my understanding- 1. He needs to File a Return for 2014-15 using ITR 1 under income from House property. With Tax as payable. 2. Not required to File anything under IDS 2016? 3. Is there any Tax exemption which I can use?
Hi,
first we need to check whether there was any capital gain from the sale proceed of the property.
as you mentioned that property was sold in 2014,
there are few things needed to arrive at capital gain , if any-
1) when was the property purchase.
2) Cost of purchase- cost of registration , stamp duty
3) is there any cost of improvement on the said property. then cost of improvement
4) is your father falls under senior citizen or age your father as on 31 march 2015
if the said property held for more than 36 months, then it will be long term capital gain or loss. benefit of cost of indexation will be given to arrive at capital gain or loss
Please share these details , to decide whether your father required to file return in that year,
Hi Vishakha Property was purchased in the year 1986 for INR 16000 All Inclusive. And Yes, my father will fall under senior citizen category.
if you cud specify which month in 1986
if it is FY 1985-1986 = capital gain is Rs 13,76,812
if it is FY 1986-87 = capital gain is Rs 13,82,971
Yes he should have filed the return - ITR 2 for capital gain.
I think still you can file the return online, i have filed return for the same FY for one of my client. other he needs to declare income IDS
your father is not eligible for capital gain exemption under section 54F as according to the section
Section 54F:
1)Proceeds from Sale of Any Capital Asset used to Purchase a Residential Property.
Any Capital Gain arising either to an Individual or a HUF from the sale of any Long Term Capital Asset shall be exempt to tax if the entire sales proceeds and not only such Gain is invested in :
The Purchase of one residential property within 1 year before the date of sale or 2 years after the due date of transfer of the property sold or
Construction of a Residential House Property within a period of 3 years from the date of transfer.
2)he could have deposited in Capital Gain Account Scheme:
To claim exemption under section 54, the taxpayer should purchase another house within a period of one year before or two years after the date of transfer of old house or should construct another house within a period of three years from the date of transfer. If till the date of filing the return of income, the assesse is not in a position to purchase or construct another house, then the benefit of exemption can be availed by depositing the unutilised amount in Capital Gains Deposit Account Scheme in any branch of public sector bank, in accordance with Capital Gains Deposit Accounts Scheme, 1988
3) Section 54EC: Proceeds from Sale of Any Capital Asset used to Purchase a Specified Bonds.
Capital Gains arising from sale of any Long Term Capital Asset are exempt under section 54EC if the assesse has within a period of 6 months from the date of transfer invested the gains in Long Term specified bonds as notified by the Govt. for a minimum period of 3 years.
Dear Sir,
1. He needs to file ITR-2 and income will be under the head of capital gain and not in house property.
2. Not required to file anything under IDS
3. No.
your capital gain will be roughly in the range of 12 lacs to 14 lacs. For exact calculation let us know the month of purchase.
We can help you in filing return of income. Please feel free to contact us at
Please feel free to call/ revert in case of any doubts
Thanks and Regards
Abhishek Dugar
CA CS B.Com
Sir we think your conversation is already going on with other professional colleague.
Hello Sir,
In such a case you should file ITR - 2 as you have LTCG. Even in such a case you have to invest the Capital Gain into CGAS, which I assume you would have done.
2. There is no need for IDS.
3. Exemption u.s 54.
Trust this clarifies your query.
Feel free to call / get back in case of further clarifications.
Thanking You.
Regards,
Rohit R Sharma
BCOM, ACA, LLB-GEN, CERT. FAFP.
