where a capital asset, being property held under trust wholly for charitable or religious purposes is transferred and the whole or any part of the net consideration is utilised for acquiring another capital asset - Income Tax - 883/CBDT

INSTRUCTION NO. 883/CBDT Dated : September 24, 1975 Section(s) Referred: 11(1A) Statute: Income - Tax Act, 1961 Section 11(1A) of the Income-tax Act, 1961 provides that where a capital asset, being property held under trust wholly for charitable or religious purposes is transferred and the whole or any part of the net consideration is utilised for acquiring another capital asset to be so held, then the capital gain arising from the transfer shall be deemed to have been applied to charitable and religious purposes to the extent specified therein. 2. The Board had occasion to examine whether investments of the net consideration in fixed deposits with a bank would be regarded as utilisation of the amount of the net consideration for acquiring "another capital asset" within the meaning of section 11(1A) of the Income-tax Act, 1961. The Board has been advised that investments of the net consideration in fixed deposit with a bank for a period of 6 months or above would be rewarded as utilisation of the net consideration for acquiring another capital asset within the meaning of section 11(1A) of the Income-tax Act, 1961. 3. These instructions may be brought to the notice of all officers working in your charge.