CBDT has issued Circular No. 1/2023 dated 06.01.2023 extending the time limit for compliance to be made for claiming any exemption under section 54 to 54GB of the Income-tax Act, 1961 (‘Act’) in view of the then Covid-19 pandemic to 31.03.2023 from earlier 30.09.2021 where the compliances under these sections were required to be made between 01.04.2021 to 28.02.2022.
Earlier, CBDT had vide Circular No. 12 of 2021 dated 25.06.2021 provided relaxation in respect of certain compliances to be made by taxpayers including inter alia investment, deposit, payment, acquisition, purchase, construction or such other action, by whatever name called. for the purpose of claiming any exemption under the provisions contained in Section 54 to 54GB of the Act.
By point 7 of the Circular of 2021, it was provided that the compliances to be made by the taxpayers such as investment, deposit, payment, acquisition, purchase, construction or such other action, by whatever name called, for the purpose of claiming any exemption under the provisions contained in Section 54 to 54GB of the Act, for which the last date of such compliance falls between 1st April 2021 to 29th September 2021 (both days inclusive), may be completed on or before 30th September 2021.
The circular issued in 2023 further extended the time limit to 31.03.20223 for making compliances under sections 54 to 54GB of the Act in view of the representations received and on further consideration of the then prevailing COVID-19 pandemic and resultant restrictions imposed, causing genuine hardship faced by taxpayers in making the aforementioned compliances under the Act.
CBDT has extended these time limits by exercising its power under Section 119 of the Act to provide that the compliances be made by the taxpayers such as investment, deposit, payment, acquisition, purchase. construction or such other action, by whatever name called, for the purpose of claiming any exemption under the provisions contained in Section 54 to 54 OB of the Act, for which the last date of such compliance falls between 01 April 2021 to 28th February 2022, may be completed on or before 31st March 2023.
Therefore, an individual who has earned Long Term Capital Gains (LTCG) by selling a house or any other capital asset and wanted to invest the LTCG in specified instruments either another residential house or specified bonds to save tax between April 1, 2021 and February 28, 2022 (both dates inclusive), now have time till March 31, 2023 to do so.
Read the full text of CBDT Circular No. 1/2023 dated 06.01.2023 on Extension of Time Limit for section 54 to 54GB Capital Gains Exemption due to COVID-19 to 31.03.2023
Circular No 1 of 2023
F. No. 225/49/2021-ITA-II
Government of India
Ministry of Finance
Department of Revenue
Central Board of Direct Taxes
*****
New Delhi, dated 06 January, 2023
Subject: Extension of time limit for compliance to be made for claiming any exemption under Section 54 to 54GB of the Income-tax Act,1961 ('Act') in view of the then-Covid-19 pandemic -reg.
The Central Board of Direct Taxes (hereinafter referred to as “the CBDT”) had vide Circular No. 12 of 2021 dated 25.06.2021 provided relaxation in respect of certain compliances to be made by taxpayers including inter alia investment, deposit, payment, acquisition, purchase, construction or such other action, by whatever name called, for the purpose of claiming any exemption under the provisions contained in Section 54 to 54GB of the Income-tax Act, 1961 (hereinafter referred to as “the Act”). By point 7 of the Circular it was provided that the aforementioned compliances for which the last date of such compliance fell between 01st April, 2021 to 29th September 2021 (both days inclusive), may be completed on or before 30th September, 2021.
In view of the representations received and on further consideration of the then-prevailing COVID-19 pandemic and resultant restrictions imposed, causing genuine hardship faced by taxpayers in making the aforementioned compliances under the Act, the CBDT, in exercise of its power under Section 119 of the Act, hereby provides that the compliances to be made by the taxpayers such as investment, deposit, payment, acquisition, purchase. construction or such other action, by whatever name called, for the purpose of claiming any exemption under the provisions contained in Section 54 to 54 GB of the Act, for which the last date of such compliance falls between 01st April, 2021 to 28th February, 2022 (both days inclusive), may be completed on or before 31st March 2023.
(Ravinder Maini)
Director to the Government of India.
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