Section 54B → Section 70
Capital gain on transfer of land used for agricultural purposes not to be charged in certain cases
Quick Answer
Section 54B of the Income Tax Act, 1961 (Capital gain on transfer of land used for agricultural purposes not to be charged in certain cases) corresponds to Section 70 of the Income-tax Act, 2025, effective 1st April 2026. Status: Retained.
What changed for Section 54B
Under the Income Tax Act, 1961, Section 54B governs capital gain on transfer of land used for agricultural purposes not to be charged in certain cases. Exempts capital gains from the sale of urban agricultural land if the proceeds are used to purchase another agricultural land within 2 years.
From 1st April 2026, the same subject sits at Section 70 of the Income-tax Act, 2025 — retained and renumbered as Section 70 of the Income-tax Act, 2025. Retained. Protects farmers who are forced to sell land near cities and wish to continue farming elsewhere.
For Section 54B, the practical impact is rated High. Common tax-saving tool for the agricultural community.
Sec 54B
Provision Summary
Exempts capital gains from the sale of urban agricultural land if the proceeds are used to purchase another agricultural land within 2 years.
Sec 70
Provision Summary
Retained. Protects farmers who are forced to sell land near cities and wish to continue farming elsewhere.
Key Changes & Highlights
- Integration with Capital Gains Account Scheme (CGAS) digitized.
Related Sections
Related Articles from the Tax Academy
general transition
Agricultural Land Tax Exemption: 1961 Act vs Income-tax Act, 2025 Guide
A professional guide on the capital gains tax changes for agricultural land sales, transitioning from the Income Tax Act 1961 to the Income-tax Act, 2025. Learn about Section 2(14) and exemption status.
nri taxation
NRI Selling Agricultural Land in India: A 2026 Tax Guide (Income-tax Act, 2025 vs 1961 Act)
A professional guide for NRIs on the tax implications of selling agricultural land in India, comparing the Income Tax Act 1961 with the Income-tax Act, 2025. Covers FEMA rules, capital gains, and repatriation.
Frequently Asked Questions
What is Section 54B of the Income Tax Act, 1961 about?
Section 54B of the Income Tax Act, 1961 covers capital gain on transfer of land used for agricultural purposes not to be charged in certain cases. Exempts capital gains from the sale of urban agricultural land if the proceeds are used to purchase another agricultural land within 2 years.
Which section replaces Section 54B in the Income-tax Act, 2025?
Section 54B of the Income Tax Act, 1961 maps to Section 70 of the Income-tax Act, 2025, effective 1st April 2026 (status: Retained). Retained. Protects farmers who are forced to sell land near cities and wish to continue farming elsewhere.
What is the impact of the change to Section 54B under the new tax code?
The transition impact for Section 54B is rated High. Common tax-saving tool for the agricultural community.
What should I watch out for when Section 54B moves to the 2025 code?
Integration with Capital Gains Account Scheme (CGAS) digitized. These points are specific to Section 54B (Capital gain on transfer of land used for agricultural purposes not to be charged in certain cases).
Disclaimer: This mapping of Section 54B (Capital gain on transfer of land used for agricultural purposes not to be charged in certain cases) to Section 70 of the Income-tax Act, 2025 is for educational and reference purposes only, based on publicly available drafts and circulars. As Section 54B is currently marked Retained, always confirm its treatment with a qualified Chartered Accountant before filing or making compliance decisions.
Need professional help on Section 54B?
Compare trusted providers — both offer CA services ready for the Income-tax Act, 2025.
*Affiliate links — we may earn a small commission at no extra cost to you. Disclosure.
Want to calculate tax on this section?