Capital Gains Reinvestment

[Asked by Guest]

Dear Forum Members

I need advice on a Capital Gains reinvestment.

I sold a Plot in Feb 2014, the capital gains of ₹ 45 Lakhs is parked in a Capital Gains account Scheme in an authorized bank. I need to reinvest by Feb 8, 2017 in an residential house (not an apartment as the 2 year time period has expired for buying an apartment)

It is now almost 2 years 10 months since I sold my plot. The query I have is

Can I buy a built old residential house within the next 2 months to claim the capital gains benefits or should I buy a Plot and construct a house within the next 2 months to claim the capital gains benefits

Advice from experts on this forum will be greatly appreciated

regards

P S Krishnan

AI Summary

Capital gains reinvestment deadline affects tax exemption; failure to reinvest triggers capital gains tax liability.
Taxpayer sold land and placed long term capital gains in a Capital Gains Account Scheme seeking exemption by reinvestment. Purchase of an existing residential dwelling is constrained by the shorter purchase deadline, whereas claiming exemption for a newly constructed dwelling requires completion within the three year construction requirement. Parking funds in an authorised capital gains account meets interim compliance, but failure to reinvest by the applicable period will make the gains taxable; interest earned in the capital gains account is taxable and contributors noted uncertainty about additional penalties.