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Selling Land and Buying Apartment: Does Unregistered Agreement Count for Tax Benefit?

T S Khurana

T S Khurana   |421 Answers  |Ask -

Tax Expert - Answered on Feb 19, 2025

A certified management accountant since 1993, T S Khurana is a fellow member of The Institute of Cost Accountants of India. His areas of expertise are income tax, specifically litigation cases, and GST.

Since the last 21 years, he has also been providing expert advice on financial matters, including investments and diversification of funds, and wealth building in the long term to his clients.
He believes that investment in real estate is the safest way for better returns and wealth generation over a period of time.

A former chairman of the Chandigarh Chapter of Institute of Cost Accountants of India, T S Khurana has also served as member of its technical committee.... more
Asked by Anonymous - Feb 17, 2025Hindi
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Hi Sir, We have sold our land a year ago, as per the guidelines we purchased new flat in apartment and is still being constructed. Just sale agreement which is not registered is good enough to claim tax benefit? The property is not yet registered and is pending completion and might go beyond two year’s guidelines on reinvestment

Ans: The amount paid within stipulated period under agreement, through banking channels with receipts, shall be available for exemption u/s 54, even if possession is delayed.
Most welcome for any further clarifications. Thanks.
DISCLAIMER: The content of this post by the expert is the personal view of the rediffGURU. Users are advised to pursue the information provided by the rediffGURU only as a source of information to be as a point of reference and to rely on their own judgement when making a decision.
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IT rule for reinvesting the amount received after Sale of Property / Flat
Ans: There are two main Income Tax (IT) rules in India for reinvesting the amount received after selling a property/flat to save capital gains tax:

Section 54: This is the most common option for reinvesting capital gains from the sale of a residential property.

Here's what you need to know about Section 54:

Reinvestment option: You can reinvest the entire sale proceeds in one new residential property.
Time limit: The new property must be purchased within one year before the sale or two years after the sale of the old property.
Construction option: If you plan to construct a new residential property, the construction must be completed within three years from the sale date.
Partial reinvestment: If the new property costs less than the sale proceeds, the exemption is available only for the reinvested amount. You may need to pay capital gains tax on the remaining amount.
Section 54EC: This section offers an alternative for reinvesting capital gains from any type of property, not just residential.

Here's what you need to know about Section 54EC:

Reinvestment option: Invest in specific long-term capital gains bonds issued by the National Housing Bank (NHB) or other government bodies.
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Investment limit: There is a maximum investment limit of Rs. 50 lakh per taxpayer.
Lock-in period: The bonds come with a lock-in period of at least 3 years.
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These are just the general highlights of the two sections. It's advisable to consult a chartered accountant (CA) or tax advisor for specific guidance based on your situation.
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Physiotherapist - Answered on Mar 22, 2025

Asked by Anonymous - Mar 03, 2025Hindi
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We are couple with 1 child. However, struggling with schools for my 11 year old who has autism, can talk and severe adhd. Schools are saying that they cannot enrol him yet due to behaviour and the fact that he wont listen to anyone and behave badly. He is smart in academics but likes to do things as he wishes creating issues. he struggles with peer communication and sitting in one place and will slouch and fall from the chair. Are there any options that we can look at. As his IQ is normal we feel he will struggle in a special school as well.
Ans: I understand how difficult and frustrating this situation must be for you as parents. Your child is bright and capable, but his challenges with behavior, attention, and sitting still are making school enrollment tough. Finding the right environment that supports both his academic strengths and his needs is essential. Inclusive schools with special education support or Montessori-style learning environments may offer a more flexible and understanding approach. Occupational therapy can help increase his sitting tolerance, posture, and focus, while behavioral therapy can support emotional regulation and social interactions. You might also consider discussing the option of a shadow teacher with school staff, as one-on-one assistance in a classroom can make a big difference. In case you don't get access to an occupational therapist, approach a physiotherapist with an understanding of Sensory Integration, as they can also help with improving his body awareness and tolerance for sitting. You are not alone in this journey, and with the right support, your child can thrive. I encourage you to connect with a special educator or developmental therapist to explore the best options for him. I request you to be strong and determined. for your son.

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