2. In case of inherited property kindly consider following:

A) Whether property is held by you and your father together for a period of more than 36 months

If More than 36 months than it is Long Term Gain :

a) The date of purchase of property by your father.

b) Cost of purchase by your father

c) Date of death of your father

d) If property was purchased before 1-4-81 you can substitute the Fair market value as on 1-4-81 as the cost of Acquisition

e) The cost of acquisition for you shall be the cost to your father or Fair value ass on 1-4-81

f) Index the cost of acquisition using cost indexation

B) In case Short Term i.e. Less Than 36 months Full amount is taxable

In case the long term capital gains is invested in any of the specified bonds listed under the Income-tax Law for a minimum period of three years, the amount of Capital Gains gets exempted from tax liability.

Normally, the tax liability shall be paid in three instalments namely, on or before 15th of September - 30 per cent of the tax liability; on or before 15th of December - another 30 per cent thereby aggregating to 60 per cent; and on or before 15th of March - balance 40 per cent therefore, aggregating to 100 per cent of the tax liability. Where taxes are paid as detailed above, one can avoid the levy of interest.

The specified investments for saving tax in lieu of long-term capital gains are bonds issued by National Bank for Agriculture and Rural Development; or National Highways Authority of India; or Rural Electrification Corporation Limited; or National Housing Bank; or Small Industries Development Bank of India. As mentioned in point (2) above the investment in the specified bonds shall carry a lock-in-period of minimum three years. In case you withdraw the money within the stipulated period, the capital gains exempted earlier upon investments shall get tax in the year of withdrawal of investment

You may consult a Chartered Accountant with full particulars to get right guidance on the matter or write to qubrex@gmail.com for assistance.