I am not an expert on Canadian tax but can tell you what I have discovered from my own situation, subject to your getting expert advice (including expert advice which is given by experts in this part of the forum) before your mother relies on what I say.
You do not say whether your mother is resident for tax purposes in Canada or is resident for tax purposes in India (or elsewhere). The rules are different depending on what you have to say about that starting point.
If she is resident in India, or elsewhere outside Canada, and sells the property when still resident outside Canada, she will be subject to whatever taxes will be payable in respect of the sale in India or as the case may be the country where she is resident but will not be subject to cgt in Canada and so far as I am aware will be able to transfer the proceeds of sale to Canada without incurring liability for further tax in Canada. If on the other hand when still resident for tax purposes in India or elsewhere she then becomes resident in Canada when still the owner of the property, Canadian tax law deems the property to have been sold at its market value at the date of moving to Canada and then to have been repurchased at the same price. When that principle applies there is no gain (because there is no difference between the deemed sale price and the repurchase price) at the time of moving. If however the property is afterwards sold, Canadian cgt will be payable but only in repect of the difference between the deemed repurchase price and the actual sale price. Whether cgt will be payable also in India, and how the gain will be calculated there, is something I do not know. The UK I know is about to introduce a law which will make cgt payable in the UK even if the property owner has ceased to be resident. I understand that the change in the law has only been announced and not yet formulated; so I do not as yet know whether the property owner would in those circumstances be subject to tax in both places; but I very much doubt whether that will be the case and guess that the UK/Canada dual taxation treaty will have something to say about that matter. And dont ask me whether there is such a principle in India: I do not know!
Steaky's advice is written on the assumption that your mother is already resident for tax purposes in Canada, and correctly states that cgt will then be payable in repect of the gain, in Canada. However bear in mind that in those circumstances your mother would, on moving to Canada, have been deemed to sell the property at its market value (see above) and to repurchase it at the same value. So a later sale of the property in Canada would only attract cgt on the difference between the deemed repurchase value and the actual sale proceeds if higher.
Or so I believe!
