Capital gains tax exemption

vijaykumar (Querist) 27 March 2015 This query is : Resolved
We sold our house of which my mother was the sole owner on 20th march, 2012. Since my mother is illeterate and prints thumb, due to make transfer of money easy (mother cannot sign cheques) we asked the buyer to transfer all the money (cash) in my account. The estimated long term capital gains was about 12 lacs. At that time I did not know anything about capital gains and so I did not deposit any money in the 'capital gains account scheme'. Within 4 months on 17th July, 2012 I paid a builder Rs 6 lacs 50 thousand to buy a plot. But I did not start any construction immediately as there was no development visible in the project for about one year and so due to non performance of the builder I asked him to refund my money, as I was living on rent and wanted my own house at the earliest possible. In the applications for refund I mentioned other reasons for seeking refund and not the non performance. The builder delayed the refund and finally refunded my money without any interest in July 2014. Since then it took me a few months time to search for a suitable property and finally I booked a flat with another builder on 5th march 2015. I have paid Rs. 10 lacs which is about 90 percent of the total sale consideration. The allotment letter was issued/executed on 19th march 2015. The company does not print separate allotment letter booklets for different buyers and so in all the allotment letters it is written that possession will be given within three years from the date of issue/execution of the allotment letter. But the company personnel say they will give possession in march 2016.

I want to know that:

If I go to the court will the court give me exemption from capital gains tax in this case. I have during the past three years constantly endeavoured to invest the money in a residential property. Also I do not have any other residential property in my name or a house of my own. But Finally I have invested most of the capital gains in a residential under construction property within three years time and also got the allotment letter/agreement issued just (one day) before the expiry of the three year period.

Is it necessary to invest the money in capital gains account scheme to get exemption.

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