Timelines for Capital Gains Reinvestment on Sale of Flat

For a flat sold in June 2024, a ready property must be purchased by June 2026, while an under-construction property must be completed by June 2027. Merely booking or paying from the Capital Gains Account is not sufficient—timely possession/completion is critical. In your case, Dec 2027 possession exceeds the legal limit, making the exemption risky and likely disputable unless defended through litigation.

Assuming the flat sold in June 2024 was a long-term residential house and you are claiming exemption under section 54, the purchase/construction timelines are measured from the date of transfer. A new ready flat must generally be purchased within one year before or two years after the sale—so, for a June 2024 transfer, by the corresponding date in June 2026. Construction must be completed within three years, i.e. by the corresponding date in June 2027.

• An under-construction flat is generally considered under the construction route, but the key test is whether construction is completed within three years. If you book/buy in February 2026 but possession is only expected in December 2027, that is beyond the June 2027 limit; on those facts, the section 54 claim is at risk. Booking or payment alone does not necessarily establish timely completion.
• Capital Gains Account Scheme (CGAS) deposit does not extend these statutory periods. Any amount not used to purchase or construct within the applicable period is generally taxable in the year the period expires, subject to the CGAS rules.

The exact transfer date, nature of the original asset, and whether the developer’s construction is completed (rather than merely possession being offered) can affect the conclusion. This sale-to-purchase timeline also affects how CGAS funds should be tracked and reported. Manual tracking across sale dates, instalments and completion evidence is difficult; automation can reduce repetitive work while professional judgment stays in control. At Jir AI we provide 2,000+ AI agents and 650+ integrations to streamline your practice’s day-to-day workload. For a workflow walkthrough, message us on WhatsApp: https://wa.me/message/3HVOZ7HIY4ESC1