Section 54EC exemption depends on registration date for immovable property transfer when computing the six-month bond investment period.

For section 54EC, the six-month investment period runs from the date on which transfer of immovable property is completed by registration of the sale deed, not from the earlier execution date. Although the transaction was executed on 08.10.2012, the conveyance was registered on 16.01.2013, and the capital gain was invested in specified NHAI bonds within six months of registration. The assessee was therefore held entitled to exemption under section 54EC, and the disallowance was set aside.

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Issues: Whether the assessee was entitled to exemption under section 54EC on the ground that the transfer of immovable property was completed only on registration of the sale deed on 16.01.2013, making the investment in specified bonds within six months from the date of transfer.

Analysis: The disputed property transaction was first executed on 08.10.2012, but the sale deed was ultimately registered only on 16.01.2013. The statutory scheme under section 23 of the Registration Act and section 54 of the Transfer of Property Act shows that a sale of immovable property is complete only upon registration of the conveyance, even though section 47 of the Registration Act allows the registered document to operate from the date of execution. On the facts, the assessee invested the capital gain in NHAI bonds on 31.05.2013 and 31.07.2013, which fell within six months from the date of registration and completion of transfer.

Conclusion: The assessee was entitled to exemption under section 54EC, and the disallowance was set aside.

Ratio Decidendi: For section 54EC, where transfer of immovable property is completed only upon registration of the sale deed, the six-month period runs from the date of completed registration, not merely from the initial execution of the instrument.

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