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Ask Anil: 'Will I get TDS refund of Rs 70,000?'

October 11, 2022 09:24 IST

Illustration: Dominic Xavier/

Anil Rego, CEO, Right Horizons (external link), answers your personal income tax queries.


Ravindra Reddy: Dear Sir, I shall be thankful to you if you can give your valuable answer for my following query.

1. I sold a piece or part of my residential plot to someone, say A in Financial Year 2021-22. From the gains of such sales, I purchased Capital Gain Bonds -- 54EC to lessen my Capital gain tax for FY 21-22. I know that the maximum amount of purchase of capital gain bonds limits to Rs 50 lakh in a Financial Year.

2. Now I intend to sell the remaining part of my residential plot to someone, say B in this Financial Year 2022-23. Can I purchase once again the Capital Gain Bonds in this year 2022-23 also from the sale amount to minimise my capital gain tax for FY 2022-23?

Kindly clarify at the earliest. Waiting for your reply.

Anil Rego: Since you are having separate sale deeds, they will be treated as separate sales. You can invest the capital gain to 54EC bonds as they are in different financial years.

THYSARA MANDOS: Dear Mr. Anil, I sold a plot of land measuring 200 sq yards and invested the amount fully for the purchase of an apartment. This is included in my IT returns for FY 2020-21. The apartment is getting ready and possession is by the end July 2022. I am having second thoughts and in case I wish to sell the new apartment, can I sell and if yes, what would be my tax liabilities?

Anil Rego: Since you have already availed the tax exemption, when you sell this house, which is within 2 years of purchase of house, the capital gains that you reinvested will need to be offered in the year that you sell the new apartment. That is, you will have to pay tax on the capital gains in the current year, which you saved in the FY 2020-21 by reinvesting into another property.

Padam Modi: I sold my house in Sep 2021 at a price of Rs 70 lakh. After indexation capital gain is Rs 45 lakh which I invested in 54EC bonds and balance in FD with SBI.

On 70 Lakh a TDS of Rs 70,000 was deducted which is shown in my 26AS.

My other income from interest and dividend income after taking benefit of 80C and 80DD is Rs 325000.

My question is whether TDS of 70,000 be refunded after filing my IT Return for FY 2021-22.

Anil Rego: Yes, you can claim a refund in your IT return after adjusting for any tax payable from any other source of income in the same financial year.

Varsha Godbole: GMR Infrastructure Ltd (GIL) demerged its EPC and urban infrastructure business into a new company viz. GMR Power and Urban infrastructure Ltd. (GPUIL) w.e.f. 1.4.2021.

Company allotted to its shareholders 1 shares of Rs.5 each in GPUIL for every 10 shares of Rs.1 held in GIL. In a communication to shareholders, GIL informed that cost of acquisition of equity shares allotted in GPUIL should be 7.29% of the total cost of acquisition of equity shares held in GIL prior to demerger.

If I acquire 100 shares of GIL from market @Rs.50 each (Total Rs 5,000) prior to 1.4.21, then will it be correct to treat the cost of acquisition of 10 GPUIL equity shares (of Rs. 5 each) post demerger as Rs.364.50, being 7.29% of Rs.5000 (@Rs.3.645 per equity shares) and treat revise cost of acquisition of 100 shares of GIL as Rs 4,635.50 being 92.71% of Rs 5,000? (@Rs 46.355 per share). The confusion is because of different face values of equity shares of two companies.

Will date of acquisition of equity shares of GPUIL be 1.4.2021 or will it be the original date of acquisition of shares of GIL?

Anil Rego: The Cost of acquisition calculated above is correct.

The date of acquisition will be the original date of acquisition of shares of GIL.

You can find more of Mr Rego's answers here.

Note: The questions and answers in this advisory are published to help the individual asking the question as well the large number of readers who read the same.

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