CG Account Scheme

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If you've deposited capital gains into the Capital Gains Account Scheme, you generally need to purchase a new residential property within two years of selling the old one. While the scheme has maturity dates, you don't necessarily have to wait for maturity to reinvest. If your purchase falls slightly outside the two-year window due to circumstances like property mutation, making an advance payment and potentially appealing any disallowance with supporting case law might be viable options.

Komal

Komal (Querist)
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15 May 2025 My query :-

If I have sold a residential property in a certain FY & have deposited the capital gain amount in the capital gain account scheme within the stipulated time period, for example :- deposition was made on 30th May, 2023 & my deposit shall be maturing on 29th May, 2025 i.e. after two years as prescribed by Income Tax Act, 1961.

Then whether I'll get a period of 60 days from the date of maturity or withdrawal (whichever is earlier) in order to purchase the new residential house property by transferring the above deposited amount to the seller of the new residential property at the time of registration of the property.

Kindly assist me by replying to my query asap.

CA R SEETHARAMAN

CA R SEETHARAMAN (Expert)
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15 May 2025 To claim capital gains exemption, the taxpayer should purchase another house within a period of two years after the date of transfer of old house.
No need to wait for the maturity withdraw and make purchase new property within 2 years of sale of old property.

Komal

Komal (Querist)
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15 May 2025 Due to the mutation, I'll not be able to purchase the new property or make the registration of new property in my name with in the specified period of 2 years from the sale of original property i.e. the registration of the new property or purchase of the new property will be made 15 or 20 days after the completion of the two years from the date of sale of original property.

Then what'll the consequences....????

Nikhil Kaushik

Nikhil Kaushik (Expert)
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15 May 2025 ideally, in such cases, atleast make the payment for the property in advance. even if the AO disallows, there is a decent chance of getting relief from the higher appellate authorities.

Nikhil Kaushik

Nikhil Kaushik (Expert)
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15 May 2025 refer following case laws: Rajneet Sandhu vs. DCIT in 2010 in Chandigarh
Pradeep Kumar Chowdhry vs. DCIT

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