Capital gain on Sale of Development Rights
This query is : Resolved
21 November 2009
Dear Experts,
Mr. A had a self occupid property on which only ground floor was constructed. He entered into an agreement with the developer for sale of Terrace rights to the developer for a consideration of Rs. 10,00,000 plus renovation of his portion.
How mush will the capital gain be in as the COA in this case will be Nill. Secondlly can i claim exemption u/s 54F as Mr. A owns only one property.
Mr. A had a self occupid property on which only ground floor was constructed. He entered into an agreement with the developer for sale of Terrace rights to the developer for a consideration of Rs. 10,00,000 plus renovation of his portion.
How mush will the capital gain be in as the COA in this case will be Nill. Secondlly can i claim exemption u/s 54F as Mr. A owns only one property.
C.A.Amitabh Gupta
(Expert)
23 November 2009
Since COA is Nil- Capital gain will be Rs.10 lacs. Mr. A can claim exemption u/s 54F if he has purchsed a residential house within 1 year before the date of transfer or 2 years after the date of transfer or constructed within 3 years after date of transgfer and he should not own more than one residential house on the date of transfer and should not purchase and 2nd residential property within 2 years after such date or construct within period of 3 years.
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