As your Maternal Grand Mother is 85 years in AY 2012-13, so she will not be liable to tax upto 5,00,000 rupees. Also she got gift from her father in 1940-41 on marriage, so Cost of Acquistion will be the cost to her Father or Fair Market Value as on 01/04/1981 (as per her Choice).
She got 50 Lakhs as Consideration for sale of House Property which will be taxable as Long term Capital Gains after indexation of Cost of acquisition in AY 2012-13. It does not matter that she haven't got full amount in the year of transfer i.e 2011-12.
Also amount invested for purchase of Apartment will be eligible for exemption under section 54 to the extent of 32 lakhs.
For minimising your tax liabilty the cost of acquistion chosen by you should be less than 2 Lakh rupees (provided she don't have any other source of income.)
You can understand more clearly by following illustration:
Consideration Received 50,00,000
less: Indexed Cost of acquisition (2,00,000 * 785/100) (15,70,000)
Long Term Capital Gain 34,30,000
less: Exemption u/s 54 (32,00,000)
Taxable Income 2,30,000