Recently came across the following article in Zerodha Varsity / Z-Connect.
The above article claims the following condition is applicable for LTCG tax-exemption claimed under 54F
The taxpayer should not buy or construct any additional residential house
except for the one they’re claiming the tax break for a stipulated period,
or they’ll lose this benefit.
However, upon careful review of the Section 54F of the Income Tax Act,
it appears that the actual condition is that
one must NOT purchase/construct another residential house for 2/3 years,
the income from which is chargeable under the head “Income from house property”.
i.e. purchasing/constructing another house
within the stipulated period
on its own is NOT a restriction,
as long as one does NOT receive any income from it.
Refer highlighted sub-sections, clauses, and explanation –
Source: Section 54F of the Income Tax Act.
Could you please reconfirm
whether the above condition specified in the Zerodha Varsity article
is indeed accurate?