Tax implication case is , Mr A ., who is not in to REAL ESTATE bought NON agri res.land in 1996 @ Rs12 per sqmtr , in Muncipal Limits Maharashtra, he incurred expenses on its development @ Rs170 per SqMtr in year2001, also got approval from competent authorities in 2003,
sold some part of it till 2007, paid LTCG on it / bought LTCG bonds as per sec.54.
provision of TDR ( against affected DP roads)came to be sanctioned in 2008 at Munc .Corporation,
accordingly Mr A applied for Grant of TDR s for affected portion around 2300 Sq.Mtr in 2012. of portion 925and 1375 sq.mtr,
as directed by authorities , being necessary also made expense as directed by authorities for affected portion in 2015 at Rs300 per Sq.mtr
on affected area of 925 Sq.Mtr. as per final apparel of area 925 Sq mtr of it of july 2015 , Mr.A relinquished only 925 favoring municipal corporation in Jan 2016
for the same Mr.A was allotted TDR certificate of 2030 SqMtr in may 2017.
Now Mr A ( being owner) am selling TDR of 175 sq Mtr for Rs.5 lacs in May 2017
His dilemma is )(i)whether this INCOME (as per proceeds)should be treated as business income or LTCG or Income from other sources
(ii)if, that income to be treated as LTCG
then what will be basic index for cost of acquisition as 305 of year 1996. OR or 426 of year 2001 (as mentioned in recent finance bill)
can Mr.A get benefit of indexed expenses incurred for its development and betterment by Mr.A in 2001 @ Rs170 Sq.Mtr and Rs.300 in year 2015.
CAclubindia
