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CS Executive · Tax Laws and Practice · Capital Gains

An individual under section 83 of the Income-tax Act, 2025 has not used the capital gains to buy new agricultural land before filing the return. What must be done with the unutilised amount?

The unutilised amount must be deposited in a specified bank or institution under the scheme notified by the Central Government. The deposit must be made by the return due date, and proof of deposit goes with the return.

  1. AIt is taxed immediately in that tax year
  2. BIt must be deposited in a specified bank or institution under the notified scheme by the due date for filing the returnCorrect
  3. CIt may be kept in any savings account until two years pass
  4. DIt is reinvested in any specified bond within six months

Explanation

Section 83(2) requires the unutilised amount to be deposited under the notified scheme before filing the return and not later than the due date, with proof submitted along with the return. Any amount still unused is charged in the year in which two years from the transfer expire.

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