Capital gain tax

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This query is : Resolved

Querist : Anonymous

Querist : Anonymous (Querist)

08 September 2014 QUERY regarding Capital Gain Tax on transfer of an Apartment :
We booked an Apartment for Rs.35 lacs in 3 names A,B &C in Sept.’2005. Initially we paid booking amount of Rs. 5 lacs . Then we took a bank home loan and paid Rs.20 lacs to the builder in Sept.’2009.
On completion of the apartment, in June’14 , we paid balance Rs.10 lacs to the builder . In the complete transaction, we paid a total of Rs.35 lacs to the builder plus interest of Rs.8 lacs to the bank.
But we did not take possession instead we sold the apartment to another customer for Rs.48 lacs. The customer paid transfer fees directly to the builder and got the apartment transferred in his name.
In the above case, is there any Capital Gain liability on all 3 applicants as we have not got the registry done ? And if yes, then is it long term or short term and what is the amount of tax liability on us. Please advise .
Thanks & Regards.

CA Harish Shyam Choudhary

CA Harish Shyam Choudhary (Expert)

08 September 2014 Yes, it will be treated as capital gain in the hand of all three persons, as they have sold rights in the property.

for calculation of Long or Short term capital gain, if it is sold before 3 years of purchase then it is an Short term capital gain or else long term capital gain.

in the given situation, as per the income tax tax, Date of purchase is the date mentioned in deed or date of giving possession, hence it is an short term capital gain

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