Capital gain

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kunal (Querist)
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03 March 2013 date of allotment of residential plot= 28-02-2009
loan taken on = 28-02-2009
sale deed registered on 28-02-2012

assessee paid interest amount to rs 4 lakks
for the period of 28-02-2009 to 28-02-2012

sir now my question is can assessee add this interest in cost of the plot????

please reply
thanks in advance!!!

CA PARAS BAFNA

CA PARAS BAFNA (Expert)
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03 March 2013 Yes, the assessee can add the interest in the cost of acquisition of the plot.
.

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kunal

kunal (Querist)
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03 March 2013 SIR PLEASE PROVIDE ME ANY CASE LAW

kunal

kunal (Querist)
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03 March 2013 SIR PLEASE TELL
mr. A got allotment letter for residential plot in 2009 from a company and sale deed is registered in 2011 thereafter he constructed residential house on that plot and sold his residential house in 2013

sir please tell is that residential house considered as long term capital asset?? or only plot is considered as long term capital asset??or both considered as short term capital asset

CA PARAS BAFNA

CA PARAS BAFNA (Expert)
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03 March 2013 The case law given here under is even though, in the context of interest on loan taken for purchasing a house property yet it will apply in your case also.

ACIT v Ramabrahmam(2012)27taxmann.com 104.

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kunal

kunal (Querist)
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03 March 2013 thank you sir

CA PARAS BAFNA

CA PARAS BAFNA (Expert)
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03 March 2013 Please refer the following link in connection with your query related with the holding period-

https://www.indianrealestateforum.com/gurgaon/t-long-term-capital-gain-calculation-property-14953-page2.html
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The Long Term Capital Gain will arise in case - the plot has been sold as plot.
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Construction can be taken as cost of improvement and is eligible for indexation.

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kunal

kunal (Querist)
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03 March 2013 sir you know what
you're awesome

kunal

kunal (Querist)
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03 March 2013 sir, how can we index the amount of interest??

CA PARAS BAFNA

CA PARAS BAFNA (Expert)
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03 March 2013 Interest costs run day & night. When a day ends a night starts no body can exactly say about the moment. We have to make certain criteria like sunset time or sunrise time.
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Likewise, Interest Cost can be segregated
on the basis of its accrual and the cut of date may be fixed as the last day of the FY i.e. 31st March.
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So in this way Interest of the Year or part of the year 1-year 2-year-3, and Year -4 or part of the year-4 can be found and subjected to indexation.
.

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