taxpayer can save tax by investing the gains in two residential house properties.. your father can invest in 2 properties 

2) An individual can avail this benefit only if capital gains arising from sale of residential house property does not exceed Rs 2 crore and can be availed once in a life time.

3) your mother can invest the capital gains in purchase of one property 

4) To save tax on LTCG, an individual is required to purchase a house within two years after the date of sale or construct the house within three years after the date of sale. If an individual does not wish to purchase/construct a house, then he/she can invest it in 54EC bonds within 6 months from the date of sale.

1. she (your mother) is eligible to invest in a single property 

2. since the amount of capital gain is less than 2 crores, yes, your father can buy two properties as an exemption, however, this exemption can be claimed once only.

With effect from 1.4.2020, one can invest capital gain amount in two residential building if the capital gain does not exceed two crores rupees. 

There shall be no difference in treatment if the capital gain arises from more than one property. Treatment shall be same. 

Your mother must invest in one residential property since capital gain amount exceeds 2 cr. Rupees. 

If one can not invest the full amount in one property then balance amount can be invested in capital gain bond. This will serve all purposes. 

The exemption under section 54 is available when the capital gains from property sale are reinvested into buying or constructing maximum two houses.

2)

3) your mother should not face income tax problems 

4) 

there is no bar on acquiring one residential house out of sale proceeds of two or more properties

5) Section 54 allowed exemption with respect to residential properties, the income from which was chargeable under the head ‘income from house property’.

6) Even if the assessee sells more than one residential property in the same year and the capital gains are invested in a new property, claim for exemption cannot be denied if other conditions under the section were fulfiled

CONSIDER THIS:
1. LTCG can be claimed ONLY by the specific person who had invested in the Property and reflected same in his /her Income Tax Returns. Mere purchase of property in Mother's name, will not qualify for LTCG parameters.

2. IF Mother's Income Tax Returns does not reflect the then Investment & Property asset, THEN Mother is not entitled to claim LTCG on the aggregate sale proceeds and the IT Dept., logically will conduct scrutiny & impose full Taxes and Penalty /Interest on the claimed amount. HENCE CHECK THIS FIRST.

3. IF Father had invested in the Property and the same is duly reflected in his Income Tax Returns, THEN Father alone can claim LTCG on the aggregate sale proceeds. HENCE CHECK THIS ALSO.

4. Person who claims LTCG is required to invest the "entire" LTCG amount in another property /joint /multiple property/s within Two years and within three years (if house is under construction). There is no bar to it, to the exception of again claiming LTCG during subsequent sale, wherein the entire aggregate property will have to be sold for claiming LTCG at that time. Proceeds of LTCG can also be invested in specific Govt. Bonds /Instruments.

1. She can incest the capital gain amount in single house or on two houses both are permitted as long as she is not holding any other residential property.

2. Yes he can invest same in one or two as per conditions under section 54 income tax act.

1. It would be calculated on total aggregated capital gain in the year. Your mother can freely invest in single residential property.

54EC bonds, or capital gains bonds, are one of the best way to save long-term capital gain tax. 54EC bonds are specifically meant for investors earning long-term capital gains and would like exemption on these gains. Tax deduction is available under section 54EC of the Income Tax Act

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Q.1:

Your mom was exclusive owner of one bungalow and a co-owner of the adjacent bungalow

since the bungalow in which she was the only owner fetched her capital gains exceeding 2 crores - she has to use that capital gains for investment into 1 [ONE] residential house in India

as regards the second bungalow of which your mom was a co-owner and which fetched her capital gains below 2 crores - that capital gains can be used for investment in 2 [TWO] residential houses in India [this provision is at the option of your mom. she can use the capital gains to buy 2 houses or 1 house only]

so in my view your mom can combine the capital gains from both the properties and purchase 1 [ONE] residential house and there is no necessity to buy 2 separate houses

Q2:

Yes since your father earned capital gains below 2 crore, he can, at his option, purchase 2 houses from the capital gains

INCOME-TAX ACT, 1961 Section 54 - Profit on sale of property used for residence

(1) Subject to the provisions of sub-section (2), where, in the case of an assessee being an individual or a Hindu undivided family, the capital gain arises from the transfer of a long-term capital asset, being buildings or lands appurtenant thereto, and being a residential house, the income of which is chargeable under the head "Income from house property" (hereafter in this section referred to as the original asset), and the assessee has within a period of one year before or two years after the date on which the transfer took place purchased, or has within a period of three years after that date 2[constructed, one residential house in India], then, instead of the capital gain being charged to income-tax as income of the previous year in which the transfer took place, it shall be dealt with in accordance with the following provisions of this section, that is to say, -

(i) if the amount of the capital gain is greater than the cost of the residential house so purchased or constructed (hereafter in this section referred to as the new asset), the difference between the amount of the capital gain and the cost of the new asset shall be charged under section 45 as the income of the previous year ; and for the purpose of computing in respect of the new asset any capital gain arising from its transfer within a period of three years of its purchase or construction, as the case may be, the cost shall be nil; or

(ii) if the amount of the capital gain is equal to or less than the cost of the new asset, the capital gain shall not be charged under section 45; and for the purpose of computing in respect of the new asset any capital gain arising from its transfer within a period of three years of its purchase or construction, as the case may be, the cost shall be reduced by the amount of the capital gain.

3[Provided that where the amount of the capital gain does not exceed two crore rupees, the assessee may, at his option, purchase or construct two residential houses in India, and where such option has been exercised,--

(a) the provisions of this sub-section shall have effect as if for the words "one residential house in India", the words "two residential houses in India" had been substituted;

(b) any reference in this sub-section and sub-section (2) to "new asset" shall be construed as a reference to the two residential houses in India:

Provided further that where during any assessment year, the assessee has exercised the option referred to in the first proviso, he shall not be subsequently entitled to exercise the option for the same or any other assessment year.]

It is not necessary that joint owners must invest jointly to gain exemption from capital gains. They can invest their respective share of capital gain separately into eligible investments.

Yes capital gains on the sale of house property must not exceed ₹2 crore in order to claim exemption for reinvesting in two properties.

Multiple properties are sold to buy a new residential house - exemption permitted.

Exemption under section 54 can be claimed in respect of capital gains arising on transfer of capital asset, being long-term residential house property. With effect from Assessment Year 2020-21, a taxpayer has an option to make investment in two residential house properties in India to claim section 54 exemption.

Following conditions should be satisfied to claim the benefit of section 54.

• The benefit of section 54 is available only to an individual or HUF.
• The asset transferred should be a long-term capital asset, being a residential house property.
• Within a period of one year before or two years after the date of transfer of old house, the taxpayer should acquire another residential house or should construct a residential house within a period of three years from the date of transfer of the old house. In case of compulsory acquisition the period of acquisition or construction will be determined from the date of receipt of compensation (whether original or additional).

2.  Exemption can be claimed only in respect of one residential house property purchased/constructed in India. If more than one house is purchased or constructed, then exemption under section 54 will be available in respect of one house only. No exemption can be claimed in respect of house purchased outside India.

With effect from Assessment Year 2020-21, the Finance Act, 2019 has amended Section 54 to extend the benefit of exemption in respect of investment made in two residential house properties. The exemption for investment made, by way of purchase or construction, in two residential house properties shall be available if the amount of long-term capital gains does not exceed Rs. 2 crores. If assessee exercises this option, he shall not be entitled to exercise this option again for the same or any other assessment year.

Exemption under section 54 for LTCG tax would be available against the sale of one property alone and not from multiple properties.

She can claim exemption in the jointly owned property provided she had not sold the property lying exclusively on her name alone.

Following conditions should be satisfied to claim the benefit of section 54.

• The benefit of section 54 is available only to an individual or HUF.
• The asset transferred should be a long-term capital asset, being a residential house property.
• Within a period of one year before or two years after the date of transfer of old house, the taxpayer should acquire another residential house or should construct a residential house within a period of three years from the date of transfer of the old house. In case of compulsory acquisition the period of acquisition or construction will be determined from the date of receipt of compensation (whether original or additional).

One can invest/purchase one year before or two year after the transfer of the property, and in case of construction,  it should be completed within  three years from date of transfer of old building. 

If one can not complete the purchase, he must deposit the unutilised amount of capital gain in any PSU bank under capital gain deposit scheme before filing of return generally July 31. One copy of deposit receipt of bank must be sent along with the return to claim full capital gain exemption. 

ITO vs. Smt. Rosamma Korah [2014] 45 taxmann.com 153 (Cochin – Trib.)

In the above case, assessee’s claim of exemption under section 54F was denied on ground that assessee had not deposited unutilized capital gain in capital gain account scheme within due date for filing return of income under section 139(1) – Assessee claimed that due date provided under section 139(4) should be considered. ITAT applied the ration of Hon’ble Apex Court in Prakash Nath Khanna v. CIT [2004] 266 ITR 1 wherein it was held that ‘due date’ means date for filing return under section 139(1) and not under section 139 (4) .

Under section 54F(4), assessee has to utilize amount for purchase or construction of new asset before date of furnishing return of income under section 139,

It has to be done before date of filing of return 

Last date for filing returns as applicable to your parents

So if they are not able to find a new house prior to above date then they can simply deposit the money in the capital gains account

As and how they find the new house, but within 2 years of date of transfer, the funds for purchase of that new house, can be paid from the amount lying in the capital gains account

For that the assessee needs to submit a certain form to the bank everytime a withdrawal is made from capital gains account

Also there are 2 types of account - one is a savings account and another is a FD account. 

If your bank does not charge penalty for any premature withdrawal from the FD, then its advisable to deposit the capital gains in the FD account so that till the time the funds are used, they continue to fetch the assessee higher interest as opposed to interest of savings account

Some banks have a flexi FD also where the holder can withdraw amount from the FD on demand as per his requirement and the balance is retained by the bank in the FD itself without breaking that FD

So inquire with your bank about these accounts first and accordingly select a bank which offers a flexi FD

See the amount has to be deposited in capital gain account scheme before the due date of filing of income tax returns for the financial year if new property is still not purchased.

31st july if same is due date for filing of income tax return in the case.

Before filing of income tax return.

Finding a suitable seller, arranging the requisite funds and getting the paperwork in place for a new property is one time-consuming process. Fortunately, the Income Tax Department agrees with these limitations.

If capital gains have not been invested until the date of filing of return (usually 31 July) of the financial year in which the property is sold, the gains can be deposited in a PSU bank or other banks as per the Capital Gains Account Scheme, 1988. This deposit can then be claimed as an exemption from capital gains, and no tax has to be paid on it

New property can be purchased either 1 year before the sale or 2 years after the sale of the property or invested in the construction of a property, but construction must be completed within three years.

If not used till 31th July of the financial year in which the property is sold than deposit in C account

1. It depends on your mother she can invest capital gains in more than one properties. 

2. Your father can invest capital gains in any number of properties as per his convenience.

3. For investment of capital gains in real assets seller can make investment in real estate with in two years from the date of sale of property.

No its not you can invest as aforesaid. 

3 years from date of sale. If invested before 1 month then no issue