Capital gain
This query is : Resolved
16 August 2011
if Mr. A has a plot of land with book value of Rs. 1 lakh.. Mr. A involved in partnership with Mr. B(who constructed the building on such land)..now both partners have equal share in this land and building & market value of this L & B is Rs. 6 crores..
whether this transaction will attract any Capital Gain..If Yes, then who will b lible to Capital gain..& what will b the amount of capital gain??? plz reply
whether this transaction will attract any Capital Gain..If Yes, then who will b lible to Capital gain..& what will b the amount of capital gain??? plz reply
16 August 2011
on the date of entering the partnership with B A had to make an agreement of partnership , where he has contributed the land as his share,
the fair market value on the date of agreement would be his consideration for LTCG payable on the specified day, in the year of agreement By A
after agreement the property so develped with get taxed as business under partnership firm of A&B
the fair market value on the date of agreement would be his consideration for LTCG payable on the specified day, in the year of agreement By A
after agreement the property so develped with get taxed as business under partnership firm of A&B
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16 August 2011
now Mr. A has to pay LTCG on Land t/f...
property so developed ( land & building ) is the property of partnership firm..rgt?
property so developed ( land & building ) is the property of partnership firm..rgt?
16 August 2011
true
however in joint venture cases, follow the agreement terms and value incorporated and share of possession,
however in joint venture cases, follow the agreement terms and value incorporated and share of possession,
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17 August 2011
sir ye case joint venture ka he hai..
Mr. A owned the land & Mr. B has to construct building (mall) on that...nw as per joint venture terms cinema is with Mr. A & all other shops are with Mr. B...now whether Mr. A is lible for LTCG on such t/f of land to J.V.???
Mr. A owned the land & Mr. B has to construct building (mall) on that...nw as per joint venture terms cinema is with Mr. A & all other shops are with Mr. B...now whether Mr. A is lible for LTCG on such t/f of land to J.V.???
17 August 2011
if its joint venture then look in agreement carefully, all the rates(values) and possession is divided in agreement.
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17 August 2011
sir as you said that sale consideration for LTCG for Mr. A will be the price of land taken i.e. Rs. 6 crore as per J.V. agreement...rgt..
Sec 50C will apply or not???
Book Value of land at the time of agreement is Rs. 100000/-..
both are equal holder in land & building...
Sec 50C will apply or not???
Book Value of land at the time of agreement is Rs. 100000/-..
both are equal holder in land & building...
17 August 2011
so 50000( 50% of 1 Lac) got converted in 3 cr ( 50% of 6 cr)
Maths is done, now look in agreement, and way of transfer of rights of property by A to B, LTCG scenerio will appear on transfer only.
Maths is done, now look in agreement, and way of transfer of rights of property by A to B, LTCG scenerio will appear on transfer only.
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17 August 2011
thanzzz sooo much sir for clearing my doubt... :-)
18 August 2011
Is MAP(naksha)plays any role in determining Capital Gain...?? e.g if building is made on unauthorized land for which there is no Map available?
18 August 2011
there must be some authority who collects tax on such property, communication to that authority is to be treated as plan submission.
authorized or non authorized is the matter of municipality, and local police authority, where if found unauthrized, it may get demolition order or penalized.
authorized or non authorized is the matter of municipality, and local police authority, where if found unauthrized, it may get demolition order or penalized.
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