30 June 2016
Property is sold say in the financial year 2013-2014. Full value of consideration is received and possession is handed over to purchaser. However sale deed is not executed. Will I need to pay income tax in the assessment year 2014-15. Please reply with supporting section of income tax or any case law.
If the answer to the above is Yes, what will happen if the stamp duty value of property increases in the year of executing sale deed say in financial year 2015-16 and sale deed has to be executed for the value as per stamp duty value. Whether I need to pay tax on difference amount even though no actual difference consideration is received by me.
30 June 2016
you have not mention the buy year, if it is old than 36 month then its long term and otherwise its short term capital gain. for circle rate increase, then you have to pay tax on the circle rate.
My query is not related to short term or long term gain. My issue is year in which I need to pay tax when I have not executed any sale deed in the year of receipt of full value of consideration and handing over the possession
01 July 2016
I think you still not getting me Mr. Rupesh. My question is the year in which I need to pay tax i.e. AY 2014-15 in which I have received full value of consideration and handed over the possession or AY 2016-17 in which I have executed sale deed.
01 July 2016
The Income is taxable in the year in which you have entered into an agreement and handed over possession. The date of registration is not relevant as transfer as per Section 2(47) took place in AY 2014-15. The fact of your case is similar to case decided by Ahemdabad ITAT in Sandhyaben Purohit Vs ITO (2013).
Coming to your second query, there is an amendment in section 50C in Finance Bill 2016 and applicable from 1/4/2017 that if date is differ for agreement for sale and registration then for stamp duty purpose you can consider date of agreement for sale provide you have received cheque on or before this date. You can argue your case that since it is a more of like a clarificatory amendment to remove hardship on assessee, it should be applicable from retrospective date. Regards
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