The following scheme has been framed by issuing Notification No. GSR 724(E), dated 22.06.1988:-
'In exercise of the powers conferred by sub-section (2) of section 54, sub-section (2) of section 54B, sub-section (2) of section 54D, sub-section (4) of section 54F and sub-section (2) of section 54G of the Income-tax Act, 1961 (43 of 1961), the Central Government hereby frames the following Scheme, namely:-
Short title, commencement and application.-
(1) This Scheme may be called the Capital Gains Accounts Scheme, 1988.
(2) It shall come into force on the date of its publication in the Official Gazette.
(3) It applies to all assessees who are eligible for exemption under section 54, section 54B, section 54D, section 54F or section 54G of the Income-tax Act, 1961 (43 of 1961)
In this Scheme, unless the context otherwise requires,-
(a) "account" means a deposit account under this Scheme;
(b) "account-A" means deposit account-A mentioned in paragraph 4 of this Scheme;
(c) "account-B" means deposit account-B mentioned in paragraph 4 of this Scheme;
(d) "Act" means the Income-tax Act, 1961 (43 of 1961);
(e) "Deposit Office" means any branch or branch office of the State Bank of India, constituted under the State Bank of India Act, 1955 (23 of 1955), or of a subsidiary bank as defined in the State Bank of India (Subsidiary Banks) Act, 1959 (38 of 1959), or of a corresponding new bank constituted under section 3 of the Banking Companies (Acquisition and Transfer of Undertakings) Act, 1970 (5 of 1970), or under section 3 of the Banking Companies (Acquisition and Transfer of Undertakings) Act, 1980 (40 of 1980), authorised by the Central Government, by notification in the Official Gazette, to receive deposit and maintain account of the depositor, under this Scheme;
(f) "depositor" means an assessee who is eligible to make a deposit under section 54, section 54B, section 54D, section 54F or section 54G of this Act;
(g) all other words and expressions used herein but not defined and defined in the Act shall have the meanings respectively assigned to them in the Act.
(h) "Form" means a form appended to this Scheme.
Deposits how to be made.-
A deposit or deposits may be made under the provisions of section 54 or section 54B or section 54D or section 54F or section 54G of the Act by any depositor intending to avail of the benefit under the said section or sections of the Act, as the case may be, in accordance with the provisions of this Scheme
Types of deposits.-
(1) There shall be two types of deposit accounts, namely:-
(i) "Deposit account-A" and
(ii) "Deposit account-B"
(2) The deposit made under account-A shall be in the form of 'savings deposit' and subject to the other provisions of this Scheme, withdrawals under this account can be made from time to time by the depositor.
(3) The deposit made under account-B shall be in the form of 'term deposit' with an option to the depositor to keep the deposit as cumulative or non-cumulative deposit. Except as provided under paragraph7 and paragraph 9, withdrawals under this account can be made only after the expiry of the period for which the deposit under this account has been made and accepted.
(4) Such deposits may be made in one lump sum or in instalments at any time on or before the due date of furnishing the return of income under sub-section (1) of section 139 of the Act as is applicable in the case of the depositor.
Application for opening account.-
(1) Every depositor who is desirous of opening an account or accounts, as the case may be, under this Scheme for the first time, shall apply to the deposit office in Form A or as near thereto as possible, in duplicate and tender the amount of deposit payable in the manner specified in sub-paragraph (4) and a depositor intending to avail of the benefit under more than one section of the Act, as referred to in paragraph 3, shall make separate applications in the same manner, for opening account or accounts under each of such sections.
(2) While applying under sub-paragraph (1) the depositor shall exercise his option as to whether the amount is to be deposited in account-A or in account-B or in both the accounts, and in the case of the depositor exercising his option to open account-B, the depositor shall also exercise his option as to whether the deposit is to be made as cumulative or non-cumulative deposit as referred in sub-paragraph (3) of paragraph 4.