54EA. [ Capital gain on transfer of long-term capital assets not to be charged in the case of investment in [specified securities] [Inserted by Act 33 of 1996, Section 20 (w.e.f. 1.10.1996).].
[-(1) Where the capital gain arises from the transfer of a long-term capital asset ] [Inserted by Act 33 of 1996, Section 20 (w.e.f. 1.10.1996).][before the 1st day of April, 2000] [ Inserted by Act 10 of 2000, Section 25 (w.e.f. 1.4.2001).][(the capital asset so transferred being hereafter in this section referred to as the original asset) and the assessee has, at any time within a period of six months after the date of such transfer, invested the whole or any part of the net consideration in any of the ] [Inserted by Act 33 of 1996, Section 20 (w.e.f. 1.10.1996).][bonds, debentures, shares of a public company or units of any mutual fund referred to in clause (23-D) of section 10,] [Inserted by Act 10 of 2000, Section 25 (w.e.f. 1.4.2001).][specified by the Board in this behalf by notification in the Official Gazette (such assets hereafter in this section referred to as the ] [Inserted by Act 33 of 1996, Section 20 (w.e.f. 1.10.1996).][specified securities)] [Inserted by Act 10 of 2000, Section 25 (w.e.f. 1.4.2001).][, the capital gain shall be dealt with in accordance with the following provisions of this section, that is to say,- ] [Inserted by Act 33 of 1996, Section 20 (w.e.f. 1.10.1996).](a)[ if the cost of the ] [Inserted by Act 33 of 1996, Section 20 (w.e.f. 1.10.1996).][specified securities] [Inserted by Act 10 of 2000, Section 25 (w.e.f. 1.4.2001).][is not less than the net consideration in respect of the original asset, the whole of such capital gain shall not be charged under section 45; [Inserted by Act 33 of 1996, Section 20 (w.e.f. 1.10.1996).](b)if the cost of the ] [specified securities] [Inserted by Act 10 of 2000, Section 25 (w.e.f. 1.4.2001).][is less than the net consideration in respect of the original asset, so much of the capital gain as bears to the whole of the capital gain the same proportion as the cost of acquisition of the specified securities bears to the net considerations shall not be charged under section 45. [Inserted by Act 33 of 1996, Section 20 (w.e.f. 1.10.1996).](2)Where the ] [specified securities] [ Substituted by Act 14 of 1997, Section 2, for certain words (w.e.f. 1.10.1996).][are transferred or converted (otherwise than by transfer) into money at any time within a period of three years from the date of their acquisition, the amount of capital gain arising from the transfer of the original asset not charged under section 45 on the basis of the cost of such ] [Inserted by Act 33 of 1996, Section 20 (w.e.f. 1.10.1996).] [specified securities] [Substituted by Act 14 of 1997, Section 2, for certain words (w.e.f. 1.10.1996).] [as provided in clause (a) or clause (b) of sub-section (1) shall be deemed to be the income chargeable under the head "Capital gains" relating to long-term capital assets of the previous year in which the ] [Inserted by Act 33 of 1996, Section 20 (w.e.f. 1.10.1996).][specified securities] [Substituted by Act 14 of 1997, Section 2, for certain words (w.e.f. 1.10.1996).][are transferred or converted (otherwise than by transfer) into money.Explanation. - In a case where the original asset is transferred and the assessee invests the whole or any part of the net consideration in respect of the original asset in any ] [Inserted by Act 33 of 1996, Section 20 (w.e.f. 1.10.1996).] [specified securities] [ Substituted by Act 14 of 1997, Section 2, for certain words (w.e.f. 1.10.1996).][and such assessee takes any loan or advance on the security of such ] [Inserted by Act 33 of 1996, Section 20 (w.e.f. 1.10.1996).] [specified securities] [Substituted by Act 14 of 1997, Section 2, for certain words (w.e.f. 1.10.1996).][, he shall be deemed to have converted (otherwise than by transfer) such ] [Inserted by Act 33 of 1996, Section 20 (w.e.f. 1.10.1996).][specified securities] [Substituted by Act 14 of 1997, Section 2, for certain words (w.e.f. 1.10.1996).][into money on the date on which such loan or advance is taken.(3)Where the cost of the ] [Inserted by Act 33 of 1996, Section 20 (w.e.f. 1.10.1996).] [specified securities] [Substituted by Act 14 of 1997, Section 2, for certain words (w.e.f. 1.10.1996).][has been taken into account for the purposes of clause (a) or clause (b) of sub-section (1), a rebate with reference to such cost shall not be allowed under section 88.Explanation. - For the purposes of this section,-(a)"cost", in relation to any ] [specified securities] [Substituted by Act 14 of 1997, Section 2, for certain words (w.e.f. 1.10.1996).][, means the amount invested in such ] [Inserted by Act 33 of 1996, Section 20 (w.e.f. 1.10.1996).][specified securities] [Substituted by Act 14 of 1997, Section 2, for certain words (w.e.f. 1.10.1996).][out of the net consideration received or accruing as a result of the transfer of the original asset; [Inserted by Act 33 of 1996, Section 20 (w.e.f. 1.10.1996).](b)"net consideration", in relation to the transfer of a capital asset, means the full value of the consideration received or accruing as a result of the transfer of the capital asset as reduced by the expenditure incurred wholly and exclusively in connection with such transfer.]
