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To claim Section 54 EC following conditions is to be satisfied.
Long Term Capital Asset Long term assets means any capital asset held by assessee for more than 3 Years.
If assesee has sold the Long term capital asset during the previous year and made a long term capital gain then he can invest money of capital gain in Capital gain bonds and can save tax on long term capital gain.
Assessee here means all type of assessees,like individual,firm company etc.
Amount to be invested in bonds is only capital gain not net consideration received on sale of long term capital asset
Amount exempted under this section will be amount of capital gain or amount invested in capital gain bond which ever is lower maximum up to 50Lakh(see note below)
These Bonds Maturity Period is Three years
Capital gain bonds eligible under this section are now can be issued only by REC or NABARD
Bonds can not be pledged ,sold transfer before completion of three year from purchase of bonds ,and in case its transferred then amount capital gain exempted on investment in these bonds will be made taxable in that previous year as Long term capital gain .
Amount of capital gain should be invested in Capital gain bond within 6 Month from date of transfer/sale of capital asset .
One more good news for you that 50 lakh Limit is for each financial year .As your six month limit is fall in two different Financial years so you can save 50 lakh in fy 2008-09 and 50 lakh in 2009-10.so one can save upto maximum of one crore of capital gain u/s 54EC.
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