How to use amount of sale proceeds of my flat

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Arun Sharma (Querist)
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12 November 2010 Dear Sir,
Namaskar.
I purchased a flat in Shimla in March 1996 for Rs.422000/-.Now i am selling it for Rs.2500000/-.I have recieved Rs.200000/- as token money as advance.Rest of amount will be paid to me by December 2010 as per agreement paid.I have follwing questions in my mind.

1. Can i keep the amount recieved in my savings account/ Current over draft account til i reinvest the same for purchasing another property.If yes for how much time ?

2.Is it compulsory to open a Capital Gain account in a bank ?

3.Please tell me what amount i have to keep in the capital gain account if compulsory ?

4.Can i use this amount for purchasing a plot and to pay Govt.Taxes/Registration Charges of new property.
Waiting for your reply.
Thank You.
Arun Sharma
Kalia1961@gmail.com

CA PARAS BAFNA

CA PARAS BAFNA (Expert)
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12 November 2010 1. You may retain the amount till the due date of filing of Return for the AY 2011-12.
2. Before the due date (i.e. 31-7-2011)you have to deposit the unutilised amount of capital gains in the Capital Gains Deposit Scheme A/c and the amount must be utilised within 3yeras from the date of sale.
3. Approx. Rs. 15.00 lac to be deposited in case you do not utilise ANY AMOUNT for the purchase/construction of a new house.
4.You may make such payments but you have to get completed the construction within 3 years of the transfer of old house

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Arun Sharma

Arun Sharma (Querist)
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13 November 2010 Dear Bafna ji,
Namaskar.
I thank you very much for answering my query.I am feeling obliged as you have spared your precious time for resolving my query.
Thank you.
With regards
Arun Sharma

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