ITAT Ruling: Adjoining Flats May Qualify as Single Residential House for Tax Exemption

The Mumbai bench of the Income Tax Appellate Tribunal (ITAT) has ruled that two adjoining flats can be treated as a single residential unit for Section 54F capital gains tax exemptions. The exemption is not automatically granted by purchase but requires physical verification to confirm the units are interconnected and used as one home.

Legal obstacles such as separate registration deeds, individual flat numbers, or lack of formal amalgamation approval do not inherently disqualify claims. Assessing officers must instead evaluate evidence of a shared layout, common access, and unified residential use to determine eligibility.

Editor's note: The brief concisely captures the core legal ruling and the specific conditions required for the tax exemption.