Relief under section 54 of the Income-tax Act, 1961. - Income Tax - 1081/CBDT

INSTRUCTION NO. 1081/CBDT Dated : August 3, 1977 Section(s) Referred: 54 Statute: Income - Tax Act, 1961 A question has been raised whether the relief provided under section 54 of the Income-tax Act, 1961 in respect of capital gains arising from the transfer of a house property used for residence on fulfilment of certain conditions is available to an HUF. In other words, whether an HUF which transfers any house property which was being used by it for residence of its members during the two years immediately preceding the date of transfer and purchases new house property within one year of the date of transfer or constructs, a new house property within two years from the date of transfer, is entitled to relief provided in section 54 in respect of the capital gains arising on the transfer of the said house property. 2. We have been advised that the language of the section, particularly the expression, "was being used by the assessee or a parent of his family for purpose of his or the parents' own residence" cannot be interpreted so as to extend the relief to HUF also. It is, therefore, clarified that the relief under section 54 is available only to the individual transferring house property and fulfilling the conditions mentioned in the section and not to the HUF.