Capital-Gains Tax Hacks for Long-Term Chembur Property Holders?

Have you owned a Chembur flat since the 2000s? Well done! Your indexed cost price is most likely a tenth of the market value as of right now. However, if you sell tomorrow, you may be hit with a 20% capital gains tax bill (plus a surcharge). Here are five completely legal tricks we frequently employ for Chembur long-term owners, updated to reflect the changes made to the Union Budget for 2024–2025.

Use the 2001 Fair-Market Value (FMV) as Your Base

Chembur’s average circle rate on 1 April 2001 was ₹550 per sq ft. If you bought your 1,000 sq ft flat in 1995 for ₹6 lakh, the indexed cost becomes:
₹550 × 1,000 = ₹5.5 lakh (FMV 2001) × 363/100 (FY 2024-25 CII) = ₹19.97 lakh.
That single step drops your taxable gain by ₹5.5 lakh compared to original purchase price.
Action: Get a government-approved valuer’s certificate (₹8-12 k fee) and attach it to your ITR.

Section 54EC Bonds – Lock-In 5 Years, Not 3

You can park long-term gains in NHAI or REC bonds within 6 months of sale. Yield is 5.25 % taxable, but the real gain is tax deferral.
Hack: Split the gain across both issuers to reduce concentration risk. A ₹50 lakh gain can be parked ₹25 lakh each. Bonds are currently issued every Monday—subscribe via ICICI Direct or HDFC Securities.

Buy Two Houses Instead of One (Budget 2024 Relief)

Earlier, Section 54 capped the new-house investment at ₹10 Cr. Now, you can buy TWO residential houses anywhere in India provided the combined stamp duty does not exceed ₹10 Cr.
Chembur Play: Sell your 1998 flat for ₹2.8 Cr, buy a 3-BHK in Chembur Camp for ₹1.6 Cr and a 2-BHK in Pune for ₹80 lakh. Entire ₹2.8 Cr is exempt, no questions asked.

Redevelopment Payout – Time the “Transfer” Date

If your society goes for redevelopment, the capital-gain event is triggered only on actual handover (Bombay HC ruling in Suresh Parekh vs. ITO). Till then, the money sits in the society’s escrow account and is not “sale proceeds”.
Strategy: If you expect a 3-year delay, sell another property in FY 2024-25 to utilise the ₹10 Cr exemption window, then move into the new Chembur flat when handed over—zero tax on the second transaction.

Joint-Sale with Family Trust

If the flat is still in an HUF or family trust name, the basic exemption limit doubles (₹2.5 lakh each for Karta + member). For elderly sellers, this also keeps surcharge at 15 % instead of 25 %.
Implementation: Execute a family arrangement deed (₹15 k stamp duty) before listing the property.

Real-Life Case – Mrs. Shah, Shell Colony

Purchase 1994: ₹4.8 lakh
Sale 2024: ₹2.3 Cr
Indexed cost (2001 FMV route): ₹17.4 lakh
Long-term capital gain: ₹2.12 Cr
Tax saved via Section 54EC + 2-house hack: ₹42 lakh zero tax (invested in Chembur Camp 3-BHK + Pune 2-BHK)

Checklist Before You Sign the Sale Deed

✓ Obtain 2001 valuation certificate (2 weeks)
✓ Open capital-gains account in SBI Chembur (branch opposite RCF gate)
✓ Mark calendar: 180-day window to invest in new house or 6-month window for 54EC bonds
✓ Keep photocopy of society share certificate—needed to prove holding period