capital gain

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ramesh (Querist)
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31 May 2009 We are 3 brothers & 2 sisters. Our father purchased a ground for Rs.2500 and constructed house in 1977 and in 1995 additionally constructed a floor for Rs. 200000/-. He died in the year 1997 and we demolished the house and constructed 5 apartments in the year 2008 (October). Out of 5, we retained 3 flats for three brothers and sold the two flats to outsiders and utilised the consideration of Rs.2800000/- towards construction of all the 5 flats. Being allotted a small size flat I was compensated in cash to the tune of Rs.300000/-. Pl clarify what
is the capital gain tax on my part and if anything has to be paid, what is the last date for payment. - g.ramesh (rameshrohit65@gmail.com)

CA.BHARAT BHUSHAN

CA.BHARAT BHUSHAN (Expert)
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31 May 2009 you received Rs.3,00,000/- in family settlement and hence it is not taxable.Moreover, you all brother have spent the total receipt of sale of two flats on construction, hence there will be no capital gain.

taxindiaconnect

taxindiaconnect (Expert)
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01 June 2009 Any amount recieved in family settlement is not taxable in the hands of the recepient and the since the amount has been spent on construction of houses, there is no capial gain tax due to application of section 54 of IT Act.

Ratan Sharma

Ratan Sharma (Expert)
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01 June 2009 Agreed. Show the capital gain in your IT return on prorata basis and claim expemtion u/s. 54.

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