In case the specified bonds are transferred within a period of three years from the date of acquisition, the exemption claimed earlier will be taxable in the year in which the specified bonds are transferred. Thus, tax exemption for the gains from the sale of the flat will continue if you hold the bonds till maturity in January 2021. You may invest the maturity amount in eligible government bonds, depending upon your residential status in India at the time of investment. NRIs are not eligible to invest in certain specified government bonds. However, any rental income or income on subsequent sale of the property will be taxable in India in the hands of your son.

Source: Mint August 24, 2020 16:52 UTC