Once the assessee had invested the entire capital gain in a new residential house within the period stipulated under section 54(1), the benefit of deduction cannot be denied merely for non-compliance with the requirement of depositing unutilised amount in Capital Gain Account Scheme (CGAS) before the due date of filing of return of income under section 54(2).

82. (2025) 181 taxmann.com 971 (Hyd Trib)

Nitin Bhatia vs. ITO

A.Y.: 2018-19 Date of Order: 24.12.2025

Section : 54

Once the assessee had invested the entire capital gain in a new residential house within the period stipulated under section 54(1), the benefit of deduction cannot be denied merely for non-compliance with the requirement of depositing unutilised amount in Capital Gain Account Scheme (CGAS) before the due date of filing of return of income under section 54(2).

FACTS

The assessee was an individual. During the relevant previous year, the assessee along with his spouse sold a jointly owned residential house property. The long-term capital gain (assessee’s share) on the said transfer was computed to ₹66,91,617. Thereafter, he purchased a new residential house for a total consideration of ₹4,44,00,000 by a registered sale deed dated 24.10.2019, which was within two years from the date of transfer of the original residential house. Out of the total consideration of ₹4,44,00,000, the assessee had made payments aggregating to ₹44,40,000 up to the due date of filing of the return of income under section 139(1). T