Section 54 EC: Transfer Of Land Or Building And Investment In “Specified Asset”
Asset to be transferred: Land or building or both.
Asset on which capital gain to be invested: Long term specified asset.
1. ELIGIBLE ASSESSEE
- All assessees.
2. CONDITIONS
- The land or building transferred should be a long term capital asset.
- The investment should be made within 6 months from the date of transfer.
- The assessee should not transfer or convert or avail loan or advance on the security of such bonds within a period of 5 years from the date of acquisition of such bonds.
3. LONG TERM SPECIFIED ASSETS
- Rural Electrification Corporation Limited or REC bonds.
- National Highway Authority of India or NHAI bonds.
- Any other bond notified by Central Government in the Official Gazette.
- Bonds issued by PFC (Power Finance Corporation Ltd).
- Tax savings bonds issued by IRFC (Indian Railways Finance Corporation Limited).
4. AMOUNT OF EXEMPTION
- Amount invested in specified assets (or) capital gain (or) 50 lakhs (whichever is less)
5. WITHDRAWAL OF EXEMPTION
- The capital gain bonds should not be converted into cash within a period of five years from the date of purchase.
- In case transferred or converted or availed loan or advance on such bonds before the expiry of 5 years, the amount so invested on which tax exemption was claimed, shall be taxable as long-term capital gain in the year of transfer/conversion.