capital gain
This query is : Resolved
23 December 2008
If i m having a house and i demolish the whole superstructure and reconstruct the same from scratch. Whether the reconstruction cost shall be cost of improvement.
Or the new superstructure shall be a new capital asset and period of holding of three years to calculate long term capital gain on this new superstructure shall be calculated from the date of compeletion of new house.
Or the new superstructure shall be a new capital asset and period of holding of three years to calculate long term capital gain on this new superstructure shall be calculated from the date of compeletion of new house.
23 December 2008
Second para of the question is the answer.
23 December 2008
The cost of contruction of the house will be added to the cost of asset and will not be treated as new asset.
23 December 2008
In my opinion, new house will be a new capital assets.
23 December 2008
New capital asset.
23 December 2008
Whenever the house will be sold there would be two inflation index one for the land and the other for the building.
23 December 2008
YOU HAVE THE ANSWER IN YOUR QUESTION.
IF IT IS RECONSTRUCTED ON THE SAME LAND IT NEED NOT BE TAKEN AS NEW ASSET BUT ADD THE COST OF RECONSTRUCTION TO REPAIRS & CONSIDER IT AS VALUE ADDITION TO OLD COST OF THE ASSET.
WHEN SOLD C I I WILL BE CALCULATED AS PER ORIGINAL VALUE & CII ON ADDITION AS PER THE CII OF THAT RESPECTIVE YEAR
IF IT IS RECONSTRUCTED ON THE SAME LAND IT NEED NOT BE TAKEN AS NEW ASSET BUT ADD THE COST OF RECONSTRUCTION TO REPAIRS & CONSIDER IT AS VALUE ADDITION TO OLD COST OF THE ASSET.
WHEN SOLD C I I WILL BE CALCULATED AS PER ORIGINAL VALUE & CII ON ADDITION AS PER THE CII OF THAT RESPECTIVE YEAR
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