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vsraj (administration)     08 September 2021

Capital Gains Tax - exemptions

On selling the House Property there is a Capital Gain of  say Rs. 40 lakhs.   The property was sold on 24.03.2021.The IT returns or the Assessment Year is to be filed before 30.09.2021.

The Assessee has opened Capital Gain Account on 28.06.2021 under FD for 3months (cumulative) - that is within 6 months from the date of selling the House property.   The questions are:

1) Whether the above said FD under Capital Gains Account has to be utilised ONLY for purchasing a New Property within two years OR

2) Whether the above said FD can be invested in specified Govt BONDs such as a) REC Limited, b)National Highways Authority of India c) Indian Railway Finance Corporation within 6 months from the date of selling the property.    The specific question here is  - whether the amount deposited under Capital Gain a/c can be utilised for investing in the above said bonds.


 1 Replies

Dhirajlal Rambhia

Dhirajlal Rambhia (SEO Sai Gr. Hosp.)     08 September 2021

As per rules for the withdrawal of the amount in CGSS 1988 account or FD; there are particular directives issued to bank/s. As per that the banks are not authorized to pay you the sum back without the permission of Jurisdiction ITO. Yes, the money can be paid to purchase any house property. So, you need to get permission from your ITO to withdraw the money for investment in the said Bonds.

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