Bought Property From Spouse? ₹6.92Cr ITAT Win Explained

Mumbai's tax tribunal ruled that buying a house from your spouse using long-term capital gains is valid for Section 54F exemption — as long as the deal is real and not just a paper transaction to dodge taxes.

Here's what happened: Mumbai ITAT upheld a taxpayer's ₹6.92 crore Section 54F exemption for buying a residential property from their spouse using long-term capital gains.. Tax department had challenged the claim arguing the intra-family deal was structured purely to save tax, but the tribunal found no evidence of fraud or sham.. ITAT's ruling clarifies that a genuine registered property transaction between spouses cannot be denied 54F benefits solely on grounds that it results in tax savings..

What you should do: Ensure every rupee in a family property deal moves through verifiable bank transfers — cash payments will void your Section 54F claim immediately.. Register the sale deed properly and pay full stamp duty at current circle rates — undervalued or unregistered transfers are the first thing auditors flag.. Reinvest your LTCG within the 54F deadline (1 year before or 2 years after the asset sale) and deposit surplus amounts in a Capital Gains Account Scheme (CGAS) bank account to protect the exemption while you finalise the purchase..

If your spouse is the seller, get a bank valuation certificate for the property at market price before the deal — it proves fair value and kills the tax department's 'sham transaction' argument upfront.

For readers weighing their credit and loan options, our personal loan guide and CIBIL score resources put this update in context.