Capital gain on sale of property

This query is : Resolved

Himanshu Sunil Joshi (Querist)
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22 June 2014 Dear All, There is a transaction of sale of old property. The transaction is characterised as follows: The flat in Mumbai was taken on rent by a tenant before 1981 say for deposit of Rs. 1000/- In the F.Y. 2014-15 the said flat is sold by the tenant with prior permission of the owner and after completing all legal requirements in this regard for Rs. 80 Lacs. Out of this 80 Lacs tenant has accepted to pay Re. 25 Lacs to owner. Query is: While calculating capital gain of the Tenant how much will be the sale consideration? - Will it be Rs. 55 Lacs (80-25) or Rs 80 Lacs? 2nd query is: if consideration is taken to be Rs. 80 Lacs then whether 25 Lacs paid to owner shall be allowed as cost of acquisition of the said property? Please advice me on above as soon as possible.... Thank you....

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CMA Nishad Patkar

CMA Nishad Patkar (Expert)
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25 June 2014 Your Sales Consideration would be Rs. 80 Lakhs.

You can show it as a cost of acquisition only if you have made such written agreement between both of you.Further CG on Rs. 25 Lakhs should be paid by owner.

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