Income tax on the land sold to government?

You will have to pay long-term capital gains tax If the land was not rural agricultural land in the same year in which the compensation is received. You can save tax under Section 54F by using the entire compensation to purchase a house within two years from the date of the plot’s acquisition, or construct a new house within three years. If you are unable to use the amount within the due date of filing the income tax return, it can be deposited under the capital gains in bonds of companies like the Rural Electrification Corporation of India or the National Highways Authority of India within six months from the date of the plot’s acquisition.