Advance against property forfeit

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parag (Querist)
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29 September 2014 sir,
we have sold a plot of land in the name of a private limited firm, the purchaser gave us certain advance through cheque in the company account and an agreement was signed between the company and the purchaser, the rest was to be paid in 6 months, but now the purchaser is not paying us the balance even after 10 months, my query is -
1. can we forfeit the advance received?
2. will it be treated as profit or capital gain?
3. if included in profit, can it be adjusted against carried forward losses?
thank you

CA SUNIL K GARG

CA SUNIL K GARG (Expert)
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01 October 2014 pls refer to sec 56 (2)(ix) introduced by finance act 2014, the advance forfieted will be income from other source.

CS,CA F,Numrologi TusharSampat

CS,CA F,Numrologi TusharSampat (Expert)
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01 October 2014 yes u can forefiet it and additionally sec 51 is alos applicable where it will be reduced from the cost of asset when u sell it again in future and while u calculate capital gain.

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