No Exemption For Gain on Depreciable Assets!

I have purchased commercial property 1999. sold commercial property 10.1.2007. Claimed depreciation.Since claimed depreciation Whether it become long term or short term capital gain. Whether i can get benefit investing in REC Bond. Whether i can keep deposit in capital gain Bank till 6 month from the date of sale and invest in property in next financial year. salian@vsnl.com

Since you have claimed Depreciation on the commercial property , you must have business income.In that case, any gain on the sale of the commercial property is a short term capital gain. This is by virtue of section 50 which is special provision in case of computation of capital gains on Depreciable assets.The section 50 is as under :

"50. Notwithstanding anything contained in clause (42A) of section 2, where the capital asset is an asset forming part of a block of assets in respect of which depreciation has been allowed under this Act or under the Indian Income-tax Act, 1922 (11 of 1922), the provisions of sections 48 and 49 shall be subject to the following modifications :

(1) where the full va