Section 54G exemption depends on a valid urban-area notification and cannot be supported by notifications issued for other statutory purposes.

Section 54G exemption applies only where capital gains arise from transfer of assets used for an industrial undertaking situated in an urban area declared for that purpose by the Central Government. A notification declaring Anekal as an urban area was issued only on 27.04.2006 and could not be applied retrospectively. Notifications issued under section 280Y(d) and under sections 2(1A) and 2(14) served different statutory purposes and could not be imported to support a claim under section 54G. The exemption claim was therefore not available on the facts stated.

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Issues: Whether the assessee was entitled to exemption under section 54G of the Income-tax Act, 1961 on the footing that the property transferred was in an urban area and whether notifications issued under other provisions could be used to claim the benefit.

Analysis: Section 54G grants exemption only when capital gains arise from transfer of assets used for an industrial undertaking situated in an urban area and the Central Government has declared the area as urban for that purpose. The relevant notification declaring Anekal as an urban area was issued only on 27.04.2006 and could not operate retrospectively. A notification issued under section 280Y(d) for a different relief scheme, and the notification relied on under sections 2(1A) and 2(14), were for different statutory purposes and could not be imported into section 54G. The earlier contrary view was no longer available to assist the assessee.

Conclusion: The exemption under section 54G was rightly denied and the assessee's claim failed.

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