Revocation of capital gain exemption and sale of under construction flat

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Suraj (Querist)
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17 March 2025 Dear Sir / Madam,

My query is as follows:

Mr. X sold his house on 05/03/2024, generating a capital gain of ₹20 lakhs. He then invested ₹40 lakhs in an under-construction residential flat (Flat A) in March 2024, claiming a capital gain exemption.
As of today, the new property is still under construction. He is now interested in another residential project (Project B) and plans to sell his under-construction Flat A.

1) What will be the tax implications in the case of the sale of an under-construction flat A?

2) Will his previous capital gain exemption of Rs. 20 lakhs be revoked? Will that be treated as income for FY 2024-25, chargeable to tax at the slab rate?

3) Will this flat in the new project B be eligible for a claiming period of three years for under-construction property?

Please guide.
Thanks & Regards,
Suraj

Dhirajlal Rambhia

Dhirajlal Rambhia (Expert)
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22 March 2025 As the new flat in project B is eligible for capital gains exemption if possession available within three years from sell of original flat on 05/03/2024, no need to reverse & reclaim exemption again in new ITR as practically it is not feasible.

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Suraj

Suraj (Querist)
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22 March 2025 Thank You Rambhia sir!

Message likes : 1 times

Dhirajlal Rambhia

Dhirajlal Rambhia (Expert)
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22 March 2025 You are welcome.

Dhirajlal Rambhia

Dhirajlal Rambhia (Expert)
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04 October 2025 Good luck...

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