Utilising Section 54(F) for capital gains reinvestment in under construction Home

To claim the Section 54F exemption, you must reinvest the entire net consideration (principal + gains) from your mutual funds. Because the 2030 possession date exceeds the strict 3-year construction limit, there is a risk of IT scrutiny, though judicial precedents typically protect buyers if the funds are fully invested and the builder is at fault for the delay. You cannot keep the money in a regular savings account; unutilized funds prior to your ITR filing date must be parked in a CGAS account. Finally, buying the property in joint names with your wife and routing the mutual fund proceeds to pay off a dedicated home loan OD account are both legally permissible for claiming the exemption.

Thanks Aashok for your detailed reply. I have one additional query. The money is being kept in not a regular svaings account but deposited in the Home loan account which has an Overdraft facility (SBI Maxgain). For eg:  If i have to pay 40% of total property amount of which 30% is paid by loan and 10% by self. I liquidate 20% of the total amount required from Mutual funds and use the entire proceeds(Principal+Caputal gains) to fund 10%, paid to builder and the balance 10% to the Home loan account will that be considered for tax exemption under section 54F?