Capital gain exemption for reinvestment in notified assets, with deemed taxation on early conversion or encumbrance. Capital gain on transfer of a long-term capital asset is not charged where the assessee reinvests net consideration or capital gains in Board-notified specified bonds, debentures, units or long-term specified assets within a prescribed investment window; exemption is whole or proportionate to cost invested. If those assets are transferred or otherwise converted into money within statutory holding periods, or a loan is taken on their security, the previously exempted gain is deemed taxable in the year of conversion. No rebate or deduction is allowed in respect of cost taken into account for the exemption.