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Capital gain on sale of residential property used in busines

Mohan (Audit Assisstant & Accounts Manager) (489 Points)

11 October 2016

Residential property which was owned by individual for more than 15 years and used for commercial purpose in proprietary concern now sold in F.Y.2015-2016. Depreciation has been claimed on this property in business through out these years. My question is whether sale of property will be LTCG or STCG? Is there an possible way to save tax in this case? Please give reference of sections, case laws etc. Please reply urgently since the case is covered under 44AB and due date is closing in.

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2 Replies

ABHINAND KM (Nil) (11 Points)
Replied 11 October 2016

As per sec 50 depreciable assets are treated as short term.The provisions under section 50 for computation of capital gains in the case of
depreciable assets can be invoked only under the following circumstances:
(a) When one or some of the assets in the block are sold for consideration more than
the value of the block.
(b) When all the assets are transferred for a consideration more than the value of the block.
(c) When all the assets are transferred for a consideration less than the value of the block.