Zero income tax on Capital Gain on sale of house property

Your calculation utilizing indexation (based on the 2001 valuation report) and claiming exemptions under Sections 54 and 54EC is legally sound under the second proviso to Section 112(1)(a) for properties acquired before July 23, 2024. The tax filing software is likely miscalculating or ignoring your inputs due to utility bugs handling the complex "dual computation" rule. To resolve this, use the offline Java/Excel utility, ensure all proviso checkboxes in Schedule CG are correctly selected, or have a tax professional validate your JSON file before final submission.

Dear

This is already submitted, validated and e erified. I submit my returns for so many years now. My age is 73 yrs.

By the way I used modern CA, Claude ai. I had 6 wint wealth Bond interest, 4 NCDs acquired many years ago where there was tds. I uploaded 26AS,  AIS ( after removing passwod ) Annual statement from Wint Wealth on Claude. Claude checked and summarised nicely and discovered duplicate entry in AIS. I submit the return online and Claude guided me screen by screen, this included capital gain schedule from sale of Delhi property. It also advised me to submit feedback for duplicate entry in AIS.

Your approach combining Section 54 and Section 54EC is legally valid. The challenge is that many online ITR utilities have known glitches with indexed cost and dual exemptions in the same year.

Two options that work:

Option 1: Use the offline utility (Java or Excel version) available at incometax.gov.in. The online portal version has known issues with complex capital gains schedules. Download the latest version, fill Schedule CG manually, and enter exemptions in the respective rows for Section 54 (new residential property) and Section 54EC (specified bonds).

Option 2: Calculate the exemption manually, compute the net taxable capital gain, and enter only the final taxable amount. Keep a separate worksheet showing the full computation for your records.

One condition to watch: Section 54EC has an annual cap of Rs 50 lakh across ALL specified bonds (REC, NHAI) in a financial year. The investment must be made within 6 months of the date of transfer.

For indexed cost: use the Cost Inflation Index (CII) for the year of purchase divided by the CII for the year of sale, multiplied by original purchase price. The CII table for AY 2026-27 is available at incometax.gov.in.

This [capital gains tax ready reckoner for AY 2026-27](https://taxgarden.in/blog/capital-gains-tax-rates-asset-class-ready-reckoner-india-ay-2026-27) has the CII table and both exemption conditions in one place.