URGENT: Under Section 54 of IT Act

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disha (Querist)
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18 February 2009 I want to know that if any amount is invested in "Capital Gain Deposit Account Scheme" to avail exemption to Capital Gain from residential house property under Section 54; can the amount be used by drawing an overdraft on the FD(it will be used for purchasing another property only) instead of drawing the amount directly.
The reason for the same is that the stipulated period of 3yrs u/s 54 is about to expire.In order to invest before the expiry of the period the F.D. will have to be pre-matured which will result in substantial loss.
Please guide us regarding the same.

CA Tilak Raj Sharma

CA Tilak Raj Sharma (Expert)
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18 February 2009 In my opinion amount should be invested out of capital gain account.

Bhaskaran Chackrapani Warrier

Bhaskaran Chackrapani Warrier (Expert)
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18 February 2009 Investment in the new asset should be necessarily from the amount withdrawn from the Capital Gains Accounts Scheme,1988.

K V Subba Rao

K V Subba Rao (Expert)
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18 February 2009 Bank doesn't allow at all OD or Loan against FD made under Capital Gains Accounts Scheme,1988, according to my own experience.

S.M.Indapurkar

S.M.Indapurkar (Expert)
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21 February 2009 In my opinion to claim exemption amount should be used from capital gain account.

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