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CMA Intermediate · Direct and Indirect Taxation · Capital Gains

Under the Income-tax Act, 2025, an NRI transfers a foreign exchange asset and earns long-term capital gain. The exemption from charge under section 215 is available only if the net consideration (wholly or partly) is invested in a specified asset within what period after the date of transfer?

The investment must be made within six months after the date of transfer of the foreign exchange asset. Section 215(1)(b) sets this period for a non-resident Indian who wants the long-term capital gain left uncharged by investing net consideration in a specified asset.

  1. AThree months
  2. BSix monthsCorrect
  3. COne year
  4. DTwo years

Explanation

Section 215(1)(b) requires the whole or part of the net consideration to be invested in a specified asset within six months after the date of transfer. The other periods do not appear in this provision; two years belongs to the agricultural land provision (section 83).

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