CAPITAL GAIN

This query is : Resolved

Querist : Anonymous

Querist : Anonymous (Querist)

03 July 2010 PURCHASED ONE LAND ON 26.05.2001 AT RS. 127000.00. GIVEN IT TO BUILDER ON 30% CONVERSION INTO MULTISTORIED BUILDING. THE BUILDER COMPLETES THE CONSTRUCTION & I WAS ALLOTED 3 FLATS AS MY SHARE. OUT OF 3 I SOLD 2 ON 12.05.2009 FOR RS. 20.00 LACS. ON WHAT PRICE I WILL HAVE TO PAY TAX AND HOW MUCH ? THANKS IN ADVANCE.

CA.Amit Revankar

CA.Amit Revankar (Expert)
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04 July 2010 See Mr.anonymous firstly if i m not wrong, u would be required to pay the tax for transfer of land to builder( As u had relinquised the right from land against three flat which is treated as transfer(sale in layman words) under capital gain). Furthur computation will be as follow:

Sale consideration will be market value of three property allotted to u, reducing the cost of acquisition,improvement(indexed value if it is LTCG), exp wholly and exclusively incurred for sale
of land. Thereafter the market value taken for three flat as sale consideration will act as cost of acquisition at the time of selling the flat and computation will be done as per above given mechanism

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