Case Law Analysis
|Income Tax Appellate Tribunal
Section 54 IT Act | Pre-Agreement Payments Toward New Residential Property Qualify for LTCG Exemption Within One-Year Window : ITAT Mumbai
The ITAT Mumbai has ruled that payments made toward a new residential property before the one-year window preceding the sale of the old asset still count toward the cost of acquisition for Section 54 exemption. This clarifies that the entire investment, not just amounts paid within the statutory period, can be aggregated to fully offset long-term capital gains, benefiting taxpayers who make advance payments in real estate transactions.