Let say a person sold a property in the month of march 2013. He is required to file ITR for the AY 2013-14 before 31st july 2013. How will he fill the details of capital gain from the sale of property when he wants to purchase another flat next year in 2014? He could deposit the money in SBI-capital gain account. But depositing in SBI-capital gain account is not an exemption u/s 54. If he will mention the capital gain in ITR, there will be a tax demand, which is not required to be paid because he intends to purchase another property in 2014 and use exemption u/s 54 in the AY 2015-16.
How to file ITR without creating a tax demand when there is a gap of one AY from property sold to another property purchased?
Fistly, It will HAVE to be shown in the ITR as a Statutory mandate. Second, please take note, the selection of the Cells in the vast ITR Capital gains section will have to be selected which willintimate that the amount does not fall under taxation. This is very procedural and 100 percent sure that the Tax consultant on this matter will definately guide to which appropriate cell to select/deselect for showing it in ITR.