changing the url

Hi everyone,
Its been about two month since I have hosted my blog and it has been a great learning experience, thanks to the wonderful community here and at other forums.
This time I have an issue regarding domain transfer ( i actually don’t know what term to use ). Here is the issue:
My blog is called sanki.in . The domain has been purchased from godaddy and has been hosted with hostgator. Now, due to some reasons I want to change the extension of my domain…to something like sanki.it
I believe for this first of all i will have to buy a new domain ( and i will get it probably from godaddy ). What do I do after that ? the plan that I have taken from hostgator allows only one domain. so as per hostgator i can upgrade the plan and then addon another domain and finally extract the previous blog to the new one.
My question: is there a way that I can, sort of, dump the existing domain, and host the newly bought domain on the existing plan with hostgator.
And yes, will it possible for me to extract my existing blog to the new domain.
Thanks for your support. 🙂