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Question: Is it necessary to invest only in agricultural land if capital gain is being occurred by sell of agricultural land.
Answer: Unfortunately, yes. As per section 54B of the Income Tax Act, 1961, in case the property sold was used for agricultural purposes only, for at least 2 years before the date of its sale, the long term capital gains arising from the same will have to be used for purchase of another agricultural land only within 2 years from the date of sale of original property in order to avail capital gains exemption on the same.
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