25 April 2008
A was having a flat of 500 sq. ft. for last 10 years. The building was revedeveloped and he took extra 100 sq. Ft. by paying some consideration to builder. Now he sold that flat after one year of redevelopment.
In this case how the capital gain will be calculated? how to treat the extra 100 sq. ft. purchased? whether to treat it as new house purchase or else will be treated as cost of imrpovement?
25 April 2008
dear sir, pls give more details -what is the reason for redeveloping etc ? In the normal course the amount paid for 100 sq.ft. can be treated as improvements -
25 April 2008
the reason being building was old,and was demolished as agreed by all membres and new 7 floor building was constructed.....the original residents were given option to purchase certain extra space at a some ageed rate......
25 April 2008
Additional amount paid will be treated as cost of renovation and will be indexed accordingly. Calculate capital gain by reducing cost of acquisation and cost of improvement
CAclubindia
