Section 54 exemption

Under section 54 - Deduction is available to you on LTCG from sale of building being a residential house....
if the assessee constructs a new residential house within a period of 3 years from the transfer of old building.

if cost of construction is > LTCG then 100% deduction or otherwise proportionately.

Note that Sale money of old building you will have to keep in a bank account under capitAl gain account scheme (to be transferred to CGAS açcount before due date of filing return of Income)

And for construction purpose you have to withdraw from CGAS Açcount fromTime to time.

1. To add further, construction should have been completed within 3 years from the date of transfer. 
2. The application should be made for each withdrawal from CGAS. Closure requires AO consent. 
3. Payment to contractors should be either by DD or cheque from CGAS. 
4. Just to clarify, the land amount should be excluded while computing capital gains. 
Please correct me if the above solution has an alternative view.