{"id":29046,"date":"2025-03-28T00:55:28","date_gmt":"2025-03-27T19:25:28","guid":{"rendered":"https:\/\/carajput.com\/blog\/?p=29046"},"modified":"2026-03-22T18:17:17","modified_gmt":"2026-03-22T12:47:17","slug":"capital-gain-exemption-investment-in-nhai-rec-pfc-irfc-bond","status":"publish","type":"post","link":"https:\/\/carajput.com\/blog\/capital-gain-exemption-investment-in-nhai-rec-pfc-irfc-bond\/","title":{"rendered":"Capital Gain Exemption- Investment in NHAI\/REC\/PFC\/IRFC Bond"},"content":{"rendered":"<div id=\"ez-toc-container\" class=\"ez-toc-v2_0_58 counter-hierarchy ez-toc-counter ez-toc-light-blue ez-toc-container-direction\">\n<p class=\"ez-toc-title\">Page Contents<\/p>\n<label for=\"ez-toc-cssicon-toggle-item-69e146255583a\" class=\"ez-toc-cssicon-toggle-label\"><span class=\"\"><span class=\"eztoc-hide\" style=\"display:none;\">Toggle<\/span><span class=\"ez-toc-icon-toggle-span\"><svg style=\"fill: #000000;color:#000000\" xmlns=\"http:\/\/www.w3.org\/2000\/svg\" class=\"list-377408\" width=\"20px\" height=\"20px\" viewBox=\"0 0 24 24\" fill=\"none\"><path d=\"M6 6H4v2h2V6zm14 0H8v2h12V6zM4 11h2v2H4v-2zm16 0H8v2h12v-2zM4 16h2v2H4v-2zm16 0H8v2h12v-2z\" fill=\"currentColor\"><\/path><\/svg><svg style=\"fill: #000000;color:#000000\" class=\"arrow-unsorted-368013\" xmlns=\"http:\/\/www.w3.org\/2000\/svg\" width=\"10px\" height=\"10px\" viewBox=\"0 0 24 24\" version=\"1.2\" baseProfile=\"tiny\"><path d=\"M18.2 9.3l-6.2-6.3-6.2 6.3c-.2.2-.3.4-.3.7s.1.5.3.7c.2.2.4.3.7.3h11c.3 0 .5-.1.7-.3.2-.2.3-.5.3-.7s-.1-.5-.3-.7zM5.8 14.7l6.2 6.3 6.2-6.3c.2-.2.3-.5.3-.7s-.1-.5-.3-.7c-.2-.2-.4-.3-.7-.3h-11c-.3 0-.5.1-.7.3-.2.2-.3.5-.3.7s.1.5.3.7z\"\/><\/svg><\/span><\/span><\/label><input type=\"checkbox\"  id=\"ez-toc-cssicon-toggle-item-69e146255583a\"  aria-label=\"Toggle\" \/><nav><ul class='ez-toc-list ez-toc-list-level-1 ' ><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-1\" href=\"https:\/\/carajput.com\/blog\/capital-gain-exemption-investment-in-nhai-rec-pfc-irfc-bond\/#Investment_in_NHAI_REC_PFC_IRFC_Bonds_For_Capital_Gain_Exemption_Us_54EC\" title=\"Investment in NHAI, REC, PFC, &amp; IRFC Bonds For Capital Gain Exemption U\/s 54EC\">Investment in NHAI, REC, PFC, &amp; IRFC Bonds For Capital Gain Exemption U\/s 54EC<\/a><ul class='ez-toc-list-level-3'><li class='ez-toc-heading-level-3'><a class=\"ez-toc-link ez-toc-heading-2\" href=\"https:\/\/carajput.com\/blog\/capital-gain-exemption-investment-in-nhai-rec-pfc-irfc-bond\/#Us_54EC_bonds_investment_Eligibility\" title=\"U\/s 54EC bonds investment Eligibility:\u00a0\">U\/s 54EC bonds investment Eligibility:\u00a0<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-3'><a class=\"ez-toc-link ez-toc-heading-3\" href=\"https:\/\/carajput.com\/blog\/capital-gain-exemption-investment-in-nhai-rec-pfc-irfc-bond\/#Who_Should_Invest_in_54EC_Bonds\" title=\"Who Should Invest in 54EC Bonds?\">Who Should Invest in 54EC Bonds?<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-3'><a class=\"ez-toc-link ez-toc-heading-4\" href=\"https:\/\/carajput.com\/blog\/capital-gain-exemption-investment-in-nhai-rec-pfc-irfc-bond\/#Time_Limit_for_Investment\" title=\"Time Limit for Investment\">Time Limit for Investment<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-3'><a class=\"ez-toc-link ez-toc-heading-5\" href=\"https:\/\/carajput.com\/blog\/capital-gain-exemption-investment-in-nhai-rec-pfc-irfc-bond\/#Exemption_Amount\" title=\"Exemption Amount\">Exemption Amount<\/a><\/li><\/ul><\/li><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-6\" href=\"https:\/\/carajput.com\/blog\/capital-gain-exemption-investment-in-nhai-rec-pfc-irfc-bond\/#Section_54F_exemption_withdrawal_scenario_due_to_violation_of_the_3-year_holding_condition\" title=\"Section 54F exemption withdrawal scenario due to violation of the 3-year holding condition. :\u00a0\">Section 54F exemption withdrawal scenario due to violation of the 3-year holding condition. :\u00a0<\/a><ul class='ez-toc-list-level-3'><li class='ez-toc-heading-level-3'><a class=\"ez-toc-link ez-toc-heading-7\" href=\"https:\/\/carajput.com\/blog\/capital-gain-exemption-investment-in-nhai-rec-pfc-irfc-bond\/#Issue_1_What_should_be_the_%E2%80%9CDate_of_Accrual\" title=\"Issue 1: What should be the \u201cDate of Accrual?\">Issue 1: What should be the \u201cDate of Accrual?<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-3'><a class=\"ez-toc-link ez-toc-heading-8\" href=\"https:\/\/carajput.com\/blog\/capital-gain-exemption-investment-in-nhai-rec-pfc-irfc-bond\/#Issue_2_What_should_be_the_type_of_capital_gain\" title=\"Issue 2: What should be the type of capital gain?\">Issue 2: What should be the type of capital gain?<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-3'><a class=\"ez-toc-link ez-toc-heading-9\" href=\"https:\/\/carajput.com\/blog\/capital-gain-exemption-investment-in-nhai-rec-pfc-irfc-bond\/#Where_to_Report_in_the_ITR_Utility\" title=\"Where to Report in the ITR Utility?\">Where to Report in the ITR Utility?<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-3'><a class=\"ez-toc-link ez-toc-heading-10\" href=\"https:\/\/carajput.com\/blog\/capital-gain-exemption-investment-in-nhai-rec-pfc-irfc-bond\/#How_reinvesting_capital_gains_in_a_house_can_help_save_tax_under_Section_54_54F\" title=\"How reinvesting capital gains in a house can help save tax under Section 54 &amp; 54F\u00a0\">How reinvesting capital gains in a house can help save tax under Section 54 &amp; 54F\u00a0<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-3'><a class=\"ez-toc-link ez-toc-heading-11\" href=\"https:\/\/carajput.com\/blog\/capital-gain-exemption-investment-in-nhai-rec-pfc-irfc-bond\/#Summary_of_Key_Differences_54_vs_54F_vs_54EC\" title=\"Summary of Key Differences 54 vs. 54F vs. 54EC\">Summary of Key Differences 54 vs. 54F vs. 54EC<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-3'><a class=\"ez-toc-link ez-toc-heading-12\" href=\"https:\/\/carajput.com\/blog\/capital-gain-exemption-investment-in-nhai-rec-pfc-irfc-bond\/#FAQ_related_to_54_vs_54F_vs_54EC_Nuances_of_Tax_Break\" title=\"FAQ related to\u00a054 vs. 54F vs. 54EC &amp;\u00a0Nuances of Tax Break\">FAQ related to\u00a054 vs. 54F vs. 54EC &amp;\u00a0Nuances of Tax Break<\/a><\/li><\/ul><\/li><\/ul><\/nav><\/div>\n<h2><img loading=\"lazy\" decoding=\"async\" class=\"alignnone wp-image-28975\" src=\"https:\/\/carajput.com\/blog\/wp-content\/uploads\/2025\/03\/1-26.jpg\" alt=\"Better for Senior Citizens\" width=\"931\" height=\"523\" srcset=\"https:\/\/carajput.com\/blog\/wp-content\/uploads\/2025\/03\/1-26.jpg 630w, https:\/\/carajput.com\/blog\/wp-content\/uploads\/2025\/03\/1-26-300x169.jpg 300w\" sizes=\"(max-width: 931px) 100vw, 931px\" \/><\/h2>\n<h2><span class=\"ez-toc-section\" id=\"Investment_in_NHAI_REC_PFC_IRFC_Bonds_For_Capital_Gain_Exemption_Us_54EC\"><\/span><span style=\"color: #000080;\"><strong>Investment in NHAI, REC, PFC, &amp; IRFC Bonds For Capital Gain Exemption U\/s 54EC<\/strong><\/span><span class=\"ez-toc-section-end\"><\/span><\/h2>\n<p>Section 54EC of the Income Tax Act allows income tax taxpayers to claim an exemption on long-term capital gains arising from the sale of land, buildings, or both by investing in specified 54EC Capital Gain Bonds. If a person has sold a capital asset in March 2025 and wants to claim exemption under Section 54EC, they do not need to deposit the amount in the Capital Gains Account Scheme by 31.03.2025. They can directly invest in 54EC bonds within six months from the date of transfer of the capital asset. Here are key features of Capital Gain investment in NHAI, REC, PFC, or IRFC u\/s 54EC bonds investment:<\/p>\n<h3><span class=\"ez-toc-section\" id=\"Us_54EC_bonds_investment_Eligibility\"><\/span><strong><span style=\"color: #000080;\">U\/s 54EC bonds investment Eligibility:\u00a0<\/span><\/strong><span class=\"ez-toc-section-end\"><\/span><\/h3>\n<p>Capital Gain Exemption u\/s 54EC Available to individuals, Hindu Undivided Families (HUFs), companies, and other taxpayers who have sold a long-term capital asset (land\/building). The taxpayer must invest the capital gains (not the entire sale proceeds). Eligible Issuers under Capital Gain Exemption u\/s 54EC<\/p>\n<ul>\n<li style=\"list-style-type: none;\">\n<ul>\n<li>NHAI (National Highways Authority of India)<\/li>\n<li>REC (Rural Electrification Corporation)<\/li>\n<li>PFC (Power Finance Corporation)<\/li>\n<li>IRFC (Indian Railway Finance Corporation)<\/li>\n<\/ul>\n<\/li>\n<\/ul>\n<p><span style=\"color: #000080;\"><strong>Investment Deadline: <\/strong><\/span>Capital Gain Exemption u\/s 54EC can be made within 6 months from the date of sale of the capital asset. The investment must be made within six months from the date of transfer of the long-term capital asset<\/p>\n<p><strong><span style=\"color: #000080;\">Maximum Investment Limit:<\/span> <\/strong>INR 50 lakh per FY. The exemption is available for up to INR 50 lakh in a financial year.<\/p>\n<p><strong><span style=\"color: #000080;\">Taxability of Interest:<\/span> <\/strong>Interest earned (typically 5.25% per annum) is taxable under &#8220;Income from Other Sources&#8221;. No TDS deducted, but tax liability exists based on the investor\u2019s tax slab.<\/p>\n<p><span style=\"color: #000080;\"><strong>No Requirement to Use CGAS:<\/strong><\/span> Unlike Sections 54 and 54F, where CGAS is required if reinvestment is not done before the due date of filing ITR, Section 54EC does not require a CGAS deposit.<\/p>\n<p><strong><span style=\"color: #000080;\">Lock-in Period:<\/span><\/strong> 5 years (Previously 3 years, but extended to 5 years from FY 2018-19). The investment in NHAI, REC, PFC, or IRFC 54EC bonds must be held for five years to retain the exemption. Example: If a person sells a property on 15th March 2025, they have time until 14th September 2025 to invest in 54EC bonds. No need to deposit in Capital Gains Account Scheme by 31st March 2025.<\/p>\n<h3><span class=\"ez-toc-section\" id=\"Who_Should_Invest_in_54EC_Bonds\"><\/span><span style=\"color: #000080;\"><strong>Who Should Invest in 54EC Bonds?<\/strong><\/span><span class=\"ez-toc-section-end\"><\/span><\/h3>\n<p>Investors with long-term capital gains from land\/buildings who do not want to reinvest in another property.<\/p>\n<ul>\n<li style=\"list-style-type: none;\">\n<ul>\n<li>Those looking for a safe, government-backed investment with steady interest (but lower returns compared to real estate).<\/li>\n<li>Taxpayers nearing the due date for capital gains investment who want a hassle-free alternative to real estate purchases.<\/li>\n<\/ul>\n<\/li>\n<\/ul>\n<p><span style=\"color: #000080;\"><strong>Premature Withdrawal: <\/strong><\/span>Not allowed before 5 years. If sold before 5 years, capital gains exemption is revoked, and gains become taxable in the year of sale.<\/p>\n<p><strong><span style=\"color: #000080;\">Exemption Calculation:<\/span> <\/strong>Exemption = Investment in 54EC Bonds (up to \u20b950 lakh) or Capital Gains, whichever is lower.<\/p>\n<p data-start=\"81\" data-end=\"102\">Question:\u00a0If someone sells a capital asset in March 2025 and wishes to invest in 54EC bonds, do they need to deposit the amount in the Capital Gains Account Scheme (CGAS) by 31.03.2025, or can they directly invest in 54EC bonds within six months?<\/p>\n<p data-start=\"361\" data-end=\"378\">Answer: No, they do not need to deposit the capital gains into the Capital Gains Account Scheme (CGAS) if they are opting for exemption u\/s 54EC.\u00a0 Section 54EC is distinct and independent from Sections 54 &amp; 54F, which require investment in residential property and may need CGAS if the reinvestment is not immediate.<\/p>\n<p class=\"\" data-start=\"715\" data-end=\"738\">U\/s 54EC, the\u00a0entire capital gain (up to INR 50 lakhs) must be invested in specified bonds (e.g., REC, PFC, IRFC, NHAI). The investment must be made within 6 months from the date of transfer of the capital asset. There is no requirement to park the capital gains in the CGAS before investing.\u00a0Example:\u00a0If the asset was sold on 15th March 2025, the investment in 54EC bonds can be made anytime up to 14th September 2025, directly, without using the CGAS route.<\/p>\n<p><span style=\"color: #000080;\"><strong>Comparison of Section 54 vs. Section 54F vs. Section 54EC<\/strong><\/span><\/p>\n<table>\n<thead>\n<tr>\n<td><span style=\"color: #000080;\"><strong>Criteria<\/strong><\/span><\/td>\n<td><span style=\"color: #000080;\"><strong>Section 54<\/strong><\/span><\/td>\n<td><span style=\"color: #000080;\"><strong>Section 54F<\/strong><\/span><\/td>\n<td><span style=\"color: #000080;\"><strong>Section 54EC<\/strong><\/span><\/td>\n<\/tr>\n<\/thead>\n<tbody>\n<tr>\n<td><span style=\"color: #000080;\"><strong>Applicable to<\/strong><\/span><\/td>\n<td>Sale of a residential house property<\/td>\n<td>Sale of any capital asset other than a residential house (e.g., land, commercial property, shares)<\/td>\n<td>Sale of any long-term capital asset (land, building, or both)<\/td>\n<\/tr>\n<tr>\n<td><span style=\"color: #000080;\"><strong>Type of Exemption<\/strong><\/span><\/td>\n<td>Exemption on capital gains<\/td>\n<td>Exemption on net sale consideration<\/td>\n<td>Exemption on capital gains<\/td>\n<\/tr>\n<tr>\n<td><span style=\"color: #000080;\"><strong>Reinvestment Required<\/strong><\/span><\/td>\n<td>Purchase or construction of a new residential house<\/td>\n<td>Purchase or construction of a new residential house<\/td>\n<td>Investment in 54EC bonds issued by NHAI, REC, PFC, or IRFC<\/td>\n<\/tr>\n<tr>\n<td>\n<h3><span class=\"ez-toc-section\" id=\"Time_Limit_for_Investment\"><\/span><span style=\"color: #000080;\"><strong>Time Limit for Investment<\/strong><\/span><span class=\"ez-toc-section-end\"><\/span><\/h3>\n<\/td>\n<td>Purchase: Within 1 year before or 2 years after the sale date.<br \/>\nConstruction: Within 3 years after the sale<\/td>\n<td>Purchase: Within 1 year before or 2 years after the sale date.<br \/>\nConstruction: Within 3 years after the sale<\/td>\n<td>Within 6 months from the date of sale<\/td>\n<\/tr>\n<tr>\n<td><span style=\"color: #000080;\"><strong>Utilization of Capital Gains Account Scheme if investment not made before ITR filing deadline?<\/strong><\/span><\/td>\n<td>Required if new house is not purchased\/constructed before ITR filing due date<\/td>\n<td>Required if new house is not purchased\/constructed before ITR filing due date<\/td>\n<td>Not Required<\/td>\n<\/tr>\n<tr>\n<td><span style=\"color: #000080;\"><strong>Holding Period of New Asset<\/strong><\/span><\/td>\n<td>3 years<\/td>\n<td>3 years<\/td>\n<td>5 years<\/td>\n<\/tr>\n<tr>\n<td>\n<h3><span class=\"ez-toc-section\" id=\"Exemption_Amount\"><\/span><span style=\"color: #000080;\"><strong>Exemption Amount<\/strong><\/span><span class=\"ez-toc-section-end\"><\/span><\/h3>\n<\/td>\n<td>Capital Gain Amount is exempt to the extent of investment in a new house<\/td>\n<td>Entire capital gain exempt only if 100% of sale proceeds are reinvested in a new house. Otherwise, proportionate exemption is allowed.<\/td>\n<td>Exemption is limited to \u20b950 lakh per financial year<\/td>\n<\/tr>\n<tr>\n<td><span style=\"color: #000080;\"><strong>Consequences of Selling New Asset Before Holding Period<\/strong><\/span><\/td>\n<td>Exemption is revoked, and the capital gains become taxable<\/td>\n<td>Exemption is revoked, and the capital gains become taxable<\/td>\n<td>Exemption is revoked if bonds are sold before 5 years<\/td>\n<\/tr>\n<tr>\n<td><span style=\"color: #000080;\"><strong>Reinvestment Allowed in Multiple Assets?<\/strong><\/span><\/td>\n<td>Allowed (subject to conditions)<\/td>\n<td>Allowed (only one residential house in India)<\/td>\n<td>Not applicable (only 54EC bonds)<\/td>\n<\/tr>\n<tr>\n<td><span style=\"color: #000080;\"><strong>Who Should Opt for This?<\/strong><\/span><\/td>\n<td>Best for homeowners reinvesting in a new house<\/td>\n<td>Best for non-homeowners selling other assets and buying a house<\/td>\n<td>Best for those wanting fixed returns without buying property<\/td>\n<\/tr>\n<\/tbody>\n<\/table>\n<h2 data-start=\"0\" data-end=\"187\"><span class=\"ez-toc-section\" id=\"Section_54F_exemption_withdrawal_scenario_due_to_violation_of_the_3-year_holding_condition\"><\/span><span style=\"color: #000080;\"><strong data-start=\"22\" data-end=\"58\">Section 54F exemption withdrawal<\/strong> scenario due to <strong data-start=\"75\" data-end=\"120\">violation of the 3-year holding condition<\/strong>. :\u00a0<\/span><span class=\"ez-toc-section-end\"><\/span><\/h2>\n<h3 data-start=\"194\" data-end=\"250\"><span class=\"ez-toc-section\" id=\"Issue_1_What_should_be_the_%E2%80%9CDate_of_Accrual\"><\/span><span style=\"color: #000080;\"><strong data-start=\"200\" data-end=\"250\">Issue 1: What should be the \u201cDate of Accrual?<\/strong><\/span><span class=\"ez-toc-section-end\"><\/span><\/h3>\n<ul>\n<li data-start=\"252\" data-end=\"462\">When Section 54F exemption is withdrawn due to the transfer\u00a0of the new asset within 3 years, the capital gain becomes \u201cdeemed to be long-term capital gain\u201d of the year in which the new asset is transferred.<\/li>\n<li data-start=\"464\" data-end=\"481\">Therefore, the date of Accrual = Date of transfer of the <em data-start=\"528\" data-end=\"539\">new asset<\/em> (i.e., residential house property sold before 3 years) &amp; Not the date of transfer of the original asset (unlisted shares)<\/li>\n<li data-start=\"669\" data-end=\"805\">Why? Because the gain is <em data-start=\"698\" data-end=\"706\">deemed<\/em> to arise in the year of violation (i.e., sale of new asset), not when the original asset was sold.<\/li>\n<\/ul>\n<h3 data-start=\"812\" data-end=\"871\"><span class=\"ez-toc-section\" id=\"Issue_2_What_should_be_the_type_of_capital_gain\"><\/span><span style=\"color: #000080;\"><strong data-start=\"818\" data-end=\"871\">Issue 2: What should be the type of capital gain?<\/strong><\/span><span class=\"ez-toc-section-end\"><\/span><\/h3>\n<ul>\n<li data-start=\"873\" data-end=\"886\">In your case The original asset was unlisted equity shares (sold in FY 2022\u201323), LTCG was earlier exempt under Section 54F. Now that the new house is sold before 3 years, the exemption is revoked, and the previous LTCG becomes taxable in the year of violation (FY 2024\u201325 \/ AY 2025\u201326).<\/li>\n<li data-start=\"1182\" data-end=\"1204\">Taxability : As per Budget 2024 changes (if applicable for this AY), the LTCG on unlisted shares may be taxable at 12.5% (instead of 20%) if held &gt; 24 months, and only for residents. But since this is a deemed LTCG, arising due to Section 54F violation, it retains its original nature (i.e., LTCG on unlisted shares).<\/li>\n<li data-start=\"1543\" data-end=\"1565\">In ITR Utility: Report this under &#8220;Long-Term Capital Gain for Unlisted Equity Shares., Choose an appropriate schedule\u2014typically Schedule CG &gt; B4, and the rate should be updated as per AY 2025\u201326 utility. If utility offers a 12.5% option, select it. Else, go with 20%, and revise later if clarification emerges<\/li>\n<\/ul>\n<h3 data-start=\"1930\" data-end=\"1975\"><span class=\"ez-toc-section\" id=\"Where_to_Report_in_the_ITR_Utility\"><\/span><span style=\"color: #000080;\"><strong data-start=\"1936\" data-end=\"1975\">Where to Report in the ITR Utility?<\/strong><\/span><span class=\"ez-toc-section-end\"><\/span><\/h3>\n<ul data-start=\"1977\" data-end=\"2370\">\n<li data-start=\"1977\" data-end=\"2050\">\n<p data-start=\"1979\" data-end=\"2050\">Schedule CG (Capital Gains) \u2192 Long-Term Capital Gains (item B4),<\/p>\n<\/li>\n<li data-start=\"1977\" data-end=\"2050\">\n<p data-start=\"1979\" data-end=\"2050\">Fill: Original Date of Transfer: Transfer date of unlisted shares<\/p>\n<ul data-start=\"2061\" data-end=\"2370\">\n<li data-start=\"2129\" data-end=\"2185\">\n<p data-start=\"2131\" data-end=\"2185\">Deemed Date of Accrual: Transfer date of new house<\/p>\n<\/li>\n<li data-start=\"2188\" data-end=\"2249\">\n<p data-start=\"2190\" data-end=\"2249\">Cost of Acquisition \/ Sale: As per original computation<\/p>\n<\/li>\n<li data-start=\"2252\" data-end=\"2308\">\n<p data-start=\"2254\" data-end=\"2308\">Exemption Claimed Earlier: Show as <em data-start=\"2293\" data-end=\"2308\">withdrawn now<\/em><\/p>\n<\/li>\n<li data-start=\"2311\" data-end=\"2370\">\n<p data-start=\"2313\" data-end=\"2370\">Net LTCG: Amount previously exempt now deemed taxable<\/p>\n<\/li>\n<\/ul>\n<\/li>\n<\/ul>\n<div class=\"_tableContainer_16hzy_1\">\n<div class=\"_tableWrapper_16hzy_14 group flex w-fit flex-col-reverse\" tabindex=\"-1\">\n<table class=\"w-fit min-w-(--thread-content-width)\" style=\"height: 182px;\" width=\"922\" data-start=\"2393\" data-end=\"2962\">\n<thead data-start=\"2393\" data-end=\"2474\">\n<tr data-start=\"2393\" data-end=\"2474\">\n<th data-start=\"2393\" data-end=\"2431\" data-col-size=\"sm\"><strong>Particulars<\/strong><\/th>\n<th data-start=\"2431\" data-end=\"2474\" data-col-size=\"sm\"><strong>Value \/ Response<\/strong><\/th>\n<\/tr>\n<\/thead>\n<tbody data-start=\"2556\" data-end=\"2962\">\n<tr data-start=\"2556\" data-end=\"2638\">\n<td data-start=\"2556\" data-end=\"2593\" data-col-size=\"sm\">Date of Accrual<\/td>\n<td data-col-size=\"sm\" data-start=\"2593\" data-end=\"2638\">Date of sale of new residential asset<\/td>\n<\/tr>\n<tr data-start=\"2639\" data-end=\"2719\">\n<td data-start=\"2639\" data-end=\"2676\" data-col-size=\"sm\">Nature of Capital Gain<\/td>\n<td data-col-size=\"sm\" data-start=\"2676\" data-end=\"2719\">Long-Term Capital Gain<\/td>\n<\/tr>\n<tr data-start=\"2720\" data-end=\"2800\">\n<td data-start=\"2720\" data-end=\"2757\" data-col-size=\"sm\">Type of Asset<\/td>\n<td data-col-size=\"sm\" data-start=\"2757\" data-end=\"2800\">Unlisted Equity Shares<\/td>\n<\/tr>\n<tr data-start=\"2801\" data-end=\"2881\">\n<td data-start=\"2801\" data-end=\"2838\" data-col-size=\"sm\">Tax Rate<\/td>\n<td data-col-size=\"sm\" data-start=\"2838\" data-end=\"2881\">12.5% or 20% (check utility)<\/td>\n<\/tr>\n<tr data-start=\"2882\" data-end=\"2962\">\n<td data-start=\"2882\" data-end=\"2919\" data-col-size=\"sm\">Schedule in ITR<\/td>\n<td data-col-size=\"sm\" data-start=\"2919\" data-end=\"2962\">Schedule CG \u2013 Item B4 or B8<\/td>\n<\/tr>\n<\/tbody>\n<\/table>\n<\/div>\n<\/div>\n<h3><span class=\"ez-toc-section\" id=\"How_reinvesting_capital_gains_in_a_house_can_help_save_tax_under_Section_54_54F\"><\/span><span style=\"color: #000080;\">How <strong>reinvesting capital gains in a house can help save tax<\/strong> under <strong>Section 54<\/strong> &amp; <strong>54F<\/strong>\u00a0<\/span><span class=\"ez-toc-section-end\"><\/span><\/h3>\n<p><img loading=\"lazy\" decoding=\"async\" class=\"alignnone size-full wp-image-30473\" src=\"https:\/\/carajput.com\/blog\/wp-content\/uploads\/2025\/03\/How-reinvesting-capital-gains-in-a-house-can-help-save-tax-under-Section-54-54F-.jpg\" alt=\"How reinvesting capital gains in a house can help save tax under Section 54 &amp; 54F\u00a0\" width=\"1110\" height=\"1280\" srcset=\"https:\/\/carajput.com\/blog\/wp-content\/uploads\/2025\/03\/How-reinvesting-capital-gains-in-a-house-can-help-save-tax-under-Section-54-54F-.jpg 1110w, https:\/\/carajput.com\/blog\/wp-content\/uploads\/2025\/03\/How-reinvesting-capital-gains-in-a-house-can-help-save-tax-under-Section-54-54F--260x300.jpg 260w, https:\/\/carajput.com\/blog\/wp-content\/uploads\/2025\/03\/How-reinvesting-capital-gains-in-a-house-can-help-save-tax-under-Section-54-54F--888x1024.jpg 888w, https:\/\/carajput.com\/blog\/wp-content\/uploads\/2025\/03\/How-reinvesting-capital-gains-in-a-house-can-help-save-tax-under-Section-54-54F--768x886.jpg 768w, https:\/\/carajput.com\/blog\/wp-content\/uploads\/2025\/03\/How-reinvesting-capital-gains-in-a-house-can-help-save-tax-under-Section-54-54F--800x923.jpg 800w\" sizes=\"(max-width: 1110px) 100vw, 1110px\" \/><\/p>\n<p>Section 54: Applies when you sell real estate property. &amp;\u00a0Section 54F: Applies when you sell shares, mutual funds, gold, or other long-term capital assets. If you sell a long-term asset and reinvest in a residential property within the specified time frame, you can avoid paying tax on capital gains. However:<\/p>\n<ul>\n<li>Ensure compliance with ownership restrictions under Sec 54F.<\/li>\n<li>Keep track of timelines (1 year before, 2 years after, or 3 years for construction).<\/li>\n<li>Maximum exemption is INR 10 crore.<\/li>\n<\/ul>\n<p>Following Conditions &amp; Limits are mention here under :<\/p>\n<div class=\"___i31lg00 f10pi13n f14t3ns0 f1nbblvp fat0sn4 f1ov4xf1 fekwl8i f1lmfglv f1oz7aqm f1abmfm4 f1w619qj f16h0jq8\">\n<table class=\"___1hm93bs f1ddd56o f16vktn6 f1enuhaj fdclmfp f1ev3kgc ftgm304 f1uinfot fibjyge fvueend f9yszdx f1fu4s3n f3l3pb3 f1s2k7dp f8fmt76 fjvbh62 fysh76l fic4ptz f1yenhzu f1yn6nvh f14tj6oe f1jq587y f1el8yx3 f1pymoxg f1ofu761 fe6itr f7coize f1794535 f70r78m f4zgifc fk1v6el f16pyhcb fo436u6 fzy4j18 fc43013 f1hmrcvb fc4t9fq fgp09rh fjnyn6r\">\n<thead>\n<tr>\n<th>Aspect<\/th>\n<th>Section 54<\/th>\n<th>Section 54F<\/th>\n<\/tr>\n<\/thead>\n<tbody>\n<tr>\n<th scope=\"row\">Which capital asset?<\/th>\n<td>Real estate property<\/td>\n<td>Shares, MFs, gold<\/td>\n<\/tr>\n<tr>\n<th scope=\"row\">Time limit<\/th>\n<td>1 year before or 2 years after selling the asset; 3 years if constructing a house<\/td>\n<td>Same<\/td>\n<\/tr>\n<tr>\n<th scope=\"row\">How much to reinvest?<\/th>\n<td>Just capital gains<\/td>\n<td>Full sale proceeds<\/td>\n<\/tr>\n<tr>\n<th scope=\"row\">If new house price is lower?<\/th>\n<td>Remaining capital gains taxed<\/td>\n<td>Exemption = cost of new house \u00d7 capital gains \u00f7 sale proceeds<\/td>\n<\/tr>\n<tr>\n<th scope=\"row\">Already own a house?<\/th>\n<td>No restriction<\/td>\n<td>Cannot own more than 1 house at time of sale<\/td>\n<\/tr>\n<tr>\n<th scope=\"row\">Can tax break be revoked?<\/th>\n<td>Yes, if house sold within 3 years<\/td>\n<td>Same<\/td>\n<\/tr>\n<tr>\n<th scope=\"row\">Max exemption<\/th>\n<td>INR 10 crore<\/td>\n<td>INR 10 crore<\/td>\n<\/tr>\n<\/tbody>\n<\/table>\n<\/div>\n<h3><span class=\"ez-toc-section\" id=\"Summary_of_Key_Differences_54_vs_54F_vs_54EC\"><\/span><span style=\"color: #000080;\"><strong>Summary of Key Differences 54 vs. 54F vs. 54EC<\/strong><\/span><span class=\"ez-toc-section-end\"><\/span><\/h3>\n<ul>\n<li>Section 54 applies only to sellers of residential houses.<\/li>\n<li>Under Section 54F applies to sellers of any other asset who reinvest in a residential house.<\/li>\n<li>Section 54EC applies to any long-term capital asset but requires investment in specified bonds instead of property<\/li>\n<\/ul>\n<p><img loading=\"lazy\" decoding=\"async\" class=\"alignnone size-full wp-image-31558\" src=\"https:\/\/carajput.com\/blog\/wp-content\/uploads\/2025\/03\/Short-Team-capital-gain.jpg\" alt=\"Short Team capital gain\" width=\"720\" height=\"960\" srcset=\"https:\/\/carajput.com\/blog\/wp-content\/uploads\/2025\/03\/Short-Team-capital-gain.jpg 720w, https:\/\/carajput.com\/blog\/wp-content\/uploads\/2025\/03\/Short-Team-capital-gain-225x300.jpg 225w\" sizes=\"(max-width: 720px) 100vw, 720px\" \/><\/p>\n<h3><span class=\"ez-toc-section\" id=\"FAQ_related_to_54_vs_54F_vs_54EC_Nuances_of_Tax_Break\"><\/span><span style=\"color: #000080;\"><strong>FAQ related to\u00a0<\/strong><strong>54 vs. 54F vs. 54EC &amp;\u00a0<\/strong><strong>Nuances of Tax Break<\/strong><\/span><span class=\"ez-toc-section-end\"><\/span><\/h3>\n<p><span style=\"color: #000080;\"><strong>Q.1: Debt fund gains qualify?<\/strong><\/span><br \/>\nAns. Yes, if bought before April 1, 2023 and sold after 3 years (with exemption till July 23, 2024).<\/p>\n<p><span style=\"color: #000080;\"><strong>Q.2: Can claim both Sec 54 &amp; Sec 54F together?<\/strong><\/span><br \/>\nAns. Yes, but each exemption applies to its respective asset.<\/p>\n<p><span style=\"color: #000080;\"><strong>Q.3: Can buy land?<\/strong><\/span><br \/>\nAns. Yes, but must construct a house within 3 years.<\/p>\n<p><span style=\"color: #000080;\"><strong>Q.4: If under-construction apartment delayed beyond 3 years?<\/strong><\/span><br \/>\nAns . Courts allow relief if delay is beyond your control.<\/p>\n<p><span style=\"color: #000080;\"><strong>Q.5: Can repay home loan with sale amount and get exemption?<\/strong><\/span><br \/>\nAns. Yes, if all other conditions are met.<\/p>\n","protected":false},"excerpt":{"rendered":"<p>Investment in NHAI, REC, PFC, &amp; IRFC Bonds For Capital Gain Exemption U\/s 54EC Section 54EC of the Income Tax Act allows income tax taxpayers to claim an exemption on long-term capital gains arising from the sale of land, buildings, or both by investing in specified 54EC Capital Gain Bonds. If a person has sold &hellip;<\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[150],"tags":[1582],"aioseo_notices":[],"_links":{"self":[{"href":"https:\/\/carajput.com\/blog\/wp-json\/wp\/v2\/posts\/29046"}],"collection":[{"href":"https:\/\/carajput.com\/blog\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/carajput.com\/blog\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/carajput.com\/blog\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/carajput.com\/blog\/wp-json\/wp\/v2\/comments?post=29046"}],"version-history":[{"count":5,"href":"https:\/\/carajput.com\/blog\/wp-json\/wp\/v2\/posts\/29046\/revisions"}],"predecessor-version":[{"id":30472,"href":"https:\/\/carajput.com\/blog\/wp-json\/wp\/v2\/posts\/29046\/revisions\/30472"}],"wp:attachment":[{"href":"https:\/\/carajput.com\/blog\/wp-json\/wp\/v2\/media?parent=29046"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/carajput.com\/blog\/wp-json\/wp\/v2\/categories?post=29046"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/carajput.com\/blog\/wp-json\/wp\/v2\/tags?post=29046"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}