Sec 54ec exemption 6 months period & deemed date of alltment

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This query is : Resolved

Querist : Anonymous

Querist : Anonymous (Querist)

03 December 2011 My client B sold land on 18.06.2011 and made capital
gain of Rs.24 lakhs.Now he wants to invest 24lakhs in National
Highways Authority of India ie NHAI to avail exemption
u/s 54EC by issuing a cheque dated 06.12.11 infavour
of NHAI on 06.12.2011.

But in application instructions, it is mentioned that
deemed date of allottment will be last day of each
month for application money cleared & credited in
NHAI's collection account.ie DATE OF ALLOTMENT-
at the last day of every month.

Now I want to know,
1.six months period expires on 17.12.2011. Does it
amount to investement within 6 months
if he issues cheque dated 06.12.2011 ?

2.as date of allotment will be last day of every month
ie 31.12.2011, can assessee gets exemption u/s
54EC ?
Pl.clarify.

CA PARAS BAFNA

CA PARAS BAFNA (Expert)
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03 December 2011 Yes. He will be eligible for the deduction.
Recently I have been clarified by one of the agents looking after the investment matters that interest will start to accrue from the very next day of payment, even though from the administration point of view these bonds are allotted at the last date of the month. This clarification is eventhough applicable for 80CCF LTI Bonds of L&T. Similar clarification may be sought for in connection with the 54EC bonds.
.

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