Assessee, a non-resident Indian, had sold his bungalow and earned long-term capital gain. He invested a portion of capital gains towards purchase of a new residential flat and claimed exemption under section 54. Assessing Officer held that since new property was purchased by assessee on 21-12-16 i.e. beyond one year preceding to sale of old property, he was not entitled for deduction under section 54. On appeal the Tribunal held that  the  assessee had sold old property on 23-10-2018 and had entered into agreement to purchase new flat on 21-12-2016 wherein he had only received right to get flat from developer.  It was only on 24-1-2018 that assessee received possession letter of said new property after construction was completed. The  new property shall be deemed to have been acquired only when it was ready, full consideration had been paid and possession was received by assessee and, therefore, where at time of execution of agreement, residential property was not in existence, date of possession of flat would be actual date of purchase for claiming exemption under section 54.  Since assessee had received possession of new flat on 24-12-2018, which was within prescribed time limit under section 54 from date of sale of old residential house i.e. 23-10-2018, assessee was entitled for claiming benefit of exemption under section 54.  (AY. 2019-20)