Homebuyers Get Tax Relief: ITAT Rules Redevelopment Extra Space Qualifies for Sec 54

• Mumbai ITAT ruled that buying extra space in a property redevelopment project can be considered an investment in a new home.
• This investment qualifies for Long Term Capital Gain (LTCG) tax exemption under Section 54 of the Income Tax Act.
• The decision benefits homebuyers who upgrade to larger flats through redevelopment.
• Section 54 allows tax exemption on LTCG from selling a residential property if reinvested in another residential property in India within specified timelines.
• The new property must be held for at least three years; otherwise, the exemption is revoked.

Why It Matters: Homebuyers get tax relief on capital gains for extra space in property redevelopment.