CAPGAIN › Answers › Capital gains & TDS on property › Section 54, 54F and 54EC under the Income-tax Act 2025: saving tax on property gains

Section 54, 54F and 54EC under the Income-tax Act 2025: saving tax on property gains

Short answer: Section 54's reinvestment exemption continues unchanged as Section 82 - same Rs 10 crore cap, same time windows, same CGAS requirement.

Built from 6 entries in CAPGAIN's law library · checked 25 Sept 2026

Section 82, Income-tax Act 2025 - Residential House Exemption (successor to Section 54)
Section 86, Income-tax Act 2025 - Reinvestment in Residential House (successor to Section 54F)
Section 85, Income-tax Act 2025 - Capital Gains Bonds (successor to Section 54EC)
Section 54B (1961) / Section 83 (2025) - Exemption on Sale of Agricultural Land
Can I Claim Section 54/54F Exemption for an Under-Construction Flat?
CIT v. Rajesh Kumar Jalan - CGAS Deposit Can Be Made by the Belated Return Due Date

Section 82, Income-tax Act 2025 - Residential House Exemption (successor to Section 54)

Section 54's reinvestment exemption continues unchanged as Section 82 - same Rs 10 crore cap, same time windows, same CGAS requirement.

Direct successor to Section 54; conditions and Rs 10 crore cap unchanged
Purchase 1 yr before/2 yrs after, or construct within 3 years
Applies to sales on/after 1 April 2026
Individuals and HUFs only

Section 82, Income-tax Act 2025 · Status: in force · official source

Section 86, Income-tax Act 2025 - Reinvestment in Residential House (successor to Section 54F)

Old Section 54F continues as Section 86 - sell a long-term non-house asset, reinvest in a house within the same windows, and your gain (proportional to reinvestment) is exempt.

Full text confirms proportional exemption based on net consideration reinvested
Same 1 yr before/2 yr after purchase and 3-year construction windows
Individuals and HUFs; applies to transfers on/after 1 April 2026

Section 86, Income-tax Act 2025 · Status: in force · official source

Section 85, Income-tax Act 2025 - Capital Gains Bonds (successor to Section 54EC)

Old Section 54EC continues as Section 85, with the 6-month investment window and Rs 50 lakh cap expected to carry over.

Confirmed successor to Section 54EC by independent commentary
6-month bond investment window expected to continue
Rs 50 lakh cap expected to continue - verify before large transactions

Section 85, Income-tax Act 2025 · Status: in force · official source

Section 54B (1961) / Section 83 (2025) - Exemption on Sale of Agricultural Land

Sell agricultural land used for farming by you/your parents in the prior 2 years, buy new agricultural land within 2 years, and your gain is exempt. Continues as Section 83 under the new Act.

Seller must be individual/HUF; land farmed by assessee or parents in the 2 years before transfer
New agricultural land must be bought within 2 years of transfer
Shortfall vs new land's cost is taxed; unused gains go into CGAS before the ITR due date
1961 Act: Section 54B; 2025 Act: Section 83 (title confirmed)

Section 54B, Income-tax Act 1961; Section 83, Income-tax Act 2025 · Status: in force · official source

Can I Claim Section 54/54F Exemption for an Under-Construction Flat?

Yes - an under-construction flat counts as 'construction' for Section 54/54F, provided it completes within 3 years of your original property's transfer. Courts allow this even with some builder delay.

Booking an under-construction flat is treated as 'construction', with a 3-year window from the original transfer
Courts have allowed exemption despite builder delays, in genuine cases
Keep the allotment letter, payment receipts and builder-buyer agreement as evidence
Unspent money by the ITR due date must go into a CGAS account

Section 54/54F, Income-tax Act 1961 (Sections 82/86, Income-tax Act 2025) · Status: in force · official source · full answer

CIT v. Rajesh Kumar Jalan - CGAS Deposit Can Be Made by the Belated Return Due Date

For Section 54/54F, if you can't reinvest right away, you must deposit unused gains in a CGAS account 'before the due date' of filing. This court held 'due date' includes the belated-return deadline, not just the original one - giving taxpayers extra room.

Interprets 'due date' for CGAS deposit as including the belated-return deadline (old Section 139(4))
Taxpayer-friendly precedent, followed by several other High Courts since
Useful for taxpayers who missed the original deadline but deposited before filing a belated return

(2006) 286 ITR 274 (Gauhati) · Status: in force · official source

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General information for India, not advice on your facts. Where an entry says a point is not yet confirmed under the Income-tax Act 2025, treat it as open.