Capital gains

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Sandy (Querist)

09 May 2013 I am a shopkeeper tenant on a commercial land property in mumbai.the land is owned by the collector who has leased it to Mr X.I am tenant of my lessee Mr X.Now Mr X has approached a builder to develop the land into residential,office spaces,and commercial units.Mr X who is the lessee will receive compensation from the builder and go out of the picture.After development I or t he newly formed society will become the direct lessee of the collector.what tax implications will I incur if I take commercial office space after surrendering my tenancy ? And what will be if I take up residential space provided I have no house of my own ? I am more interested in taking commercial premises only in exchange of my commercial space.pls guide as to what will be my tax implications.thank u.

TKKKKKK

TKKKKKK (Expert)

09 May 2013 first, if you surrender your tenancy, you will loose the benefit of expense allowed to you while calculating profit of business. simply your profit will increase at the year end. for cap gain , if you have any cap gain in the year from long term asset, you can claim deduction u/s 54f from investing in residential property. If you take commercial premises, you will not gain benefit of any deduction.

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