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Cancellation of flat booking

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This query is : Resolved

kishor (Querist)

03 September 2012 Sir,
I had booked a flat and paid 60 % of the flat value but was not able to pay the balance amount due to shortage of fund and said amount of 60% was paid together at one time and then the builder waited for 2 years but i could not pay the balance amount. Therefore the builder cancelled the booking and handed over me my amount along with interest. My question is whether under what head my tax will come for the above and what would be the percentage?

K Srinivas, CMA CS

K Srinivas, CMA CS (Expert)

03 September 2012 In my opinion, the interest given by the builder will be treated as Income from other sources and taxable in your hands. Calculate the interest for the PY 2011-2012 and PY 2010-2011 separately and report it in your return.

I am not sure about how to report the interest income of PY2010-11 now.

kishor

kishor (Querist)

04 September 2012 But this would not attract short term capital gain tax. Please advise.

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