Vishwajeet Kamal (Others) (66 Points)
24 July 2015I had purchased an under construction property in 2011. The possession got delayed and builder paid me the penalty as per the terms & condition. The builder adjusted the penalty amount with the outstanding dues to be paid by me during possession of the flat. Is penatly amount an income for me or compensation ? Does penalty attracts any kind of Tax ? Where should one declares it in ITR form or it need not be declared ?
Rajagopalakrishnan R
(PARTNER)
(1422 Points)
Replied 24 July 2015
The Penalty is in the nature of a capital receipt which will have to be reduced from the cost of acquisition of the property.
Vishwajeet Kamal
(Others)
(66 Points)
Replied 03 August 2015
Dear Sir, Last week I initiated registration process and got papers related to it from the builder. In these papers, the builder has mentioned the actual Price of the Flat though while making the final payment by me, the builder adjusted the penalty amount for the delayed possession. So, as per the builder's record, penalty is shown in the final payment sheet. So, Is there any tax to be paid by me on the penalty recieved ?
"Live Course on Python for Financial Analysis: Unlocking Efficiency in Accounting and Finance"
CAclubindia
