A Joint Development Agreement (JDA) can trigger capital gains tax even before a landowner receives or sells the flats promised under the deal. However, if those flats qualify for exemption under Section 54 or 54F of the Income-tax Act, the tax may eventually become nil. In a ruling that could benefit many landowners entering redevelopment agreements with builders, the Bengaluru bench of the Income Tax Appellate Tribunal (ITAT) has held that a taxpayer was entitled to claim exemption under Section 54/54F on all 23 flats received under a Joint Development Agreement. The Tribunal treated all the flats as one residential house for the purpose of the exemption, resulting in no capital gains tax liability despite holding that the JDA itself amounted to a transfer of the property.