Closing a Capital Gains Account Scheme (CGAS) account requires following the proper procedure, especially when only interest remains. Since your branch manager has requested Form G with the Assessing Officer’s (AO) endorsement, here’s the step-by-step guide to get it:

Step 1: Prepare Form G

Form G is the prescribed form under the Capital Gains Accounts Scheme, 1988, for closing the account and withdrawing the remaining funds. You need to fill out the form with:
✅ Your personal details (Name, PAN, Address, Account No.)
✅ Bank details where the capital gain account is held
✅ Reason for closure (In your case, only interest remains)
✅ Details of amount already disbursed and remaining balance

Step 2: Approach Your Jurisdictional Assessing Officer (AO)

• Find out who your AO is by checking the Income Tax Department’s e-filing portal https://www.incometax.gov.in.

• Visit the AO’s office with:
  📄 Duly filled Form G
  📄 Passbook/Statement of your CGAS account
  📄 Copy of PAN Card
  📄 Copy of Last ITR filed
  📄 Bank’s request letter (if any)

Step 3: Obtain AO’s Endorsement

• Submit Form G along with documents to the AO.

• The AO will verify whether the capital gain amount was utilized as per the exemption rules.

• If satisfied, they will endorse and sign Form G, permitting closure.

Step 4: Submit to the Bank

• After getting AO’s approval, submit the endorsed Form G to your bank.

• The bank will process the closure and release the remaining interest amount (after TDS deduction, if applicable).

• Ensure you take the final statement from the bank for your records.

Key Points to Note

✔️ Timelines may vary depending on AO’s workload, so follow up if needed.
✔️ Interest earned is taxable as per your income slab.
✔️ If you face delays, you may escalate the matter with your jurisdictional Principal Commissioner of Income Tax (PCIT).

Once done, your Capital Gains Account will be officially closed, and you can use the interest as per your requirement. ✅

Yes, profit earned from the sale of land, building, or both is chargeable to Capital Gains Tax under the Income Tax Act, 1961. However, the tax treatment depends on the holding period of the asset:

1️⃣ Type of Capital Gain:

✔ Short-Term Capital Gain (STCG):

• If the land/building is sold within 24 months from the date of purchase, the profit is treated as short-term capital gain (STCG).

• Taxable as per your income tax slab rate.

✔ Long-Term Capital Gain (LTCG):

• If the land/building is held for more than 24 months, the profit is classified as long-term capital gain (LTCG).

• Taxed at 20% with indexation benefit under Section 112.

Hi,

Reinvesting your capital gains into another capital asset can be highly beneficial because it allows you to defer or even reduce your tax liability. Here’s how it works:

• Tax Exemption/Deferral: By reinvesting your gains into a qualifying asset (such as residential property under Section 54 or other assets under Section 54F of the Income Tax Act), you can claim an exemption on the tax that would otherwise be payable on your capital gains. This means you keep more of your money working for you rather than handing it over as tax.

• Enhanced Investment Growth: Deferring the tax liability means that the full amount of your gains is available for reinvestment. This boosts your capital, allowing for potentially higher returns over time through compounding.

• Improved Cash Flow: Since you’re not required to pay the tax immediately, you retain liquidity and can allocate funds strategically across different assets or opportunities.

• Long-Term Financial Planning: Utilizing these exemptions effectively supports a more tax-efficient investment strategy, helping you build wealth over the long term without unnecessary tax erosion.