23 January 2013
If a house is sold in March 2012 and proceeds are invested in flat which was booked in March 2010 under construction linked scheme of builder and instalments are being paid regularly till now. Then can amount paid from March 2011 till 31-08-2012 be deemed to be amount utilised for purchase of new property though the booking of flat was done in March 2010. Assume that proceeds are not invested in Capital Gain Scheme Account.
23 January 2013
as per CIT v J.R. Subramanya Bhat (1986). it was told that construction of the house should be completed within 3 years from the date of transfer. Date of commencement of construction is irrelevant. Construction may be commenced even before the transfer of the house. So if your scheme is for construction and as house was constructed within 3 years of sale this must be allowed.
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