Empowering Industrial Growth: Understanding Section 54D

Compulsory Acquisition Relief: Section 54D offers relief from capital gains tax on properties acquired compulsorily for industrial projects, aiding affected individuals and businesses. Reinvestment Opportunity: Taxpayers can reinvest proceeds from compulsory acquisitions into new industrial assets within three years to claim exemptions under Section 54D.

Eligibility Criteria: Individuals, HUFs, companies, LLPs, and firms qualify for exemptions if the acquired property was used industrially for at least two years before acquisition. Exemption Calculation: The exemption amount is the lower of the capital gains from acquisition or the cost of the new industrial asset, fostering reinvestment and industrial continuity.

Lock-in Period: Taxpayers must retain the new industrial asset for at least three years, with consequences for early disposal outlined to ensure compliance. CGAS Scheme: The Capital Gains Account Scheme facilitates the utilization of funds for industrial reinvestment, promoting timely and appropriate utilization.

Long-term Industrial Investment: Section 54D encourages long-term investment in industrial activities by providing tax relief on compulsory acquisitions, supporting industrial growth and development.