54EC Bonds after 180 days?

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This discussion clarifies the eligibility for claiming capital gains exemption using 54EC bonds after selling a property. The key question revolves around whether the six-month investment period for 54EC bonds refers to 180 days or six calendar months. Based on a provided tax resource, it's confirmed that six calendar months are considered, not just 180 days. Therefore, investing within six calendar months of the property sale, even if it exceeds 180 days, should be acceptable for the exemption, and the Income Tax department is unlikely to send a notice for this.

VISWANATH SURESH

VISWANATH SURESH (Querist)

25 October 2023 I sold my property on 17-April-2023.
Am I eligible to buy 54EC bonds now to claim capital gains exemption? i.e after 180 days but within 6 calendar months i.e within 31-October-2023.

Further to above question, if I am eligible for exemption, even if I purchase the REC 54EC bonds now (after 180 days but before 31-Oct-2023), will IT department automatically accept it or I need to fight for it as the purchase of bonds is after 180 days but within 6 calendar months. Will Income tax department send notice since the investment in 54EC bonds is after 180 days?

Here 6 months statement w.r.t 54EC bonds leads to ambiguity and it is not clear.
Please help with more accurate information for above 2 questions.

CA R SEETHARAMAN

CA R SEETHARAMAN (Expert)

25 October 2023 It's 6 calendar months not 180 days.
See the link.
https://taxguru.in/income-tax/sec-54ec-months-means-calendar-months-180-days.html#:~:text=54EC%2D%20Six%20months%20means%20six%20calendar%20months%20and%20not%20180%20days

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VISWANATH SURESH

VISWANATH SURESH (Querist)

25 October 2023 Thanks for sharing the link. As per the link, even if I invest now (i.e. before 31-Oct-2023), I am eligible for deduction under section 54EC, please confirm on this.

CA R SEETHARAMAN

CA R SEETHARAMAN (Expert)

25 October 2023 Yes you are right....

Message likes : 1 times

VISWANATH SURESH

VISWANATH SURESH (Querist)

25 October 2023 Further to above question,
Will Income tax department automatically consider 6 calendar months for 54EC or they still consider 180 days due to ambiguity and send notice? Any idea about this?
What is the solution, if such notice is received.

CA R SEETHARAMAN

CA R SEETHARAMAN (Expert)

25 October 2023 No ambiguity no notice will be received. In case notice is received reply citing decision quoted in the link provided.

Message likes : 1 times

VISWANATH SURESH

VISWANATH SURESH (Querist)

25 October 2023 Thanks for the information.

CA R SEETHARAMAN

CA R SEETHARAMAN (Expert)

25 October 2023 You are welcome
......

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