Capital gains

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Querist : Anonymous

Querist : Anonymous (Querist)

04 August 2015 (I) IAM THE ASSESSEE OF INCOMETAX REQUESTING EXPLANATION REGARDING LONG TERM CAPITAL GAINS.
THE DETAILS ARE AS BELOW:-
ON 30/07/2008 I PURCHASED A FLAT AT HYDERABAD FRO RS.7,44,700/- (INCLUDING STAMP DUTY & REGISTRATION FEES) IN MY SONS NAME WHICH I SHOWED IN MY BALANCE SHEET AT ASSETS SIDE DURING THE ASST-YEAR 2009-2010. AND THE ABOVE SAID SAME PROPERTY WAS SOLD OUT ON 12/12/2012 WITH TOTAL COST OF RS.21,00,000/-. THE AMOUNT OF 21,00,000/- I DEPOSITED IN CAPITAL GAINS SAVINGS BANK ACCOUNT ON 23/09/2013 AT ANDHRA BANK. ON 08/11/2013 I WITHDRAW THE AMOUNT OF RS.21,00,000/- FROM S.B.ACCOUNT AND STARTED CONSTRUCTION OF HOUSE U/s 54F OF THE CAPITAL GAINS ACT. IN THE ASSESSMENT YEAR 2014-2015 I USED RS/10,14,526/- TOWARDS CONSTRUCTION OF HOUSE AND CONTINUED THE CONSTRUCTION IN THE NEXT ASSESSMENT YEAR 2015-2016 IN WHICH I SPEND THE BALANCE AMOUNT WHICH I KEPT WITH ME. TILL NOW THE CONSTRUCTION WAS GOING ON. DUE TO LACK OF MONEY I COULD NOT CONTINUE THE HOUSE CONSTRUCTION. SO, I, DECIDED TO SOLD OUT MY "1/2 SHARE OF PLOTS, WHICH I PURCHASED ALONG WITH ANOTHER PARTNER. ON 20/06/2013, 21/06/2013 & 10/07/2013 I SOLD OUT "1/2 SHARE OF ALL PLOTS. FROM THE ABOVE SAID PLOTS I GOT RS.17,04,500/- AS MY "1/2" SHARE PROFIT.
(ii) THE ABOVE SAID SOLD OUT PLOTS PURCHASED ON 18/10/2004 OF MY "1/2" SHARE RS.2,54,000/- WHICH I SHOWED IN MY BALANCE SHEET AT ASSETS SIDE DURING THE ASST-YEAR 2005-2006. AFTER RECEIVING THE RS.17.04,500/- I DEPOSITED THE SAID AMOUNT IN CAPITAL GAIN SAVINGS BANK ACCOUNT AT ANDHRA BANK, ON BEFORE SUBMISSION OF THE RETURN OF INCOME OF ASST-YEAR 2014-2015.
(iii)STILL HOUSE CONSTRUCTION IS CONTINUING IN THE NEXT ASST-YEARS ALSO MY QUESTION FOR YOU IS I FILED MY INCOMETAX RETURN FOR ASST-YEAR 2014-2015 ON 28/11/2014 AS IT IS A 44AB CASE AND INTIMATION U/S 143(1) ORDER OF THE I.T.ACT WAS PASSED ON 17/06/2015. IN WHICH ORDER THE OFFICER ADD RS.27,89,974/- AS LONG TERM CAPITAL GAIN INCOME .
(IV) ALONG WITH BUSINESS INCOME AND IMPOSSED EXTRA LEAVY TAX NEARLY UPTO 5,00,000/- I WANT EXPLANATION ABOUT LONGTERM CAPITAL GAIN INCOME WHY THE OFFICER HAD ADDED THE CAPITAL GAIN INCOME AS TAXABLE INCOME. SINCE THE ABOVE SAID BALANCE AMOUNT OF RS.27,89,974/- I USED IN HOUSE CONSTRUCTION ONLY BUT COMPLETED THE CONSTRUCTION IN THIS FINANCIAL YEAR.

Amol S Joglekar

Amol S Joglekar (Expert)
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04 August 2015 did you complete the construction within a period of 3 years from the date of transfer of the long term capital asset?
Mere putting the money in capital gain savings bank account with Andhra Bank is not sufficient. It is just a machinery whereby the assessee is required to keep the money deposited in capital gain account.
The predominant stipulations is to complete the construction within a period of 3 years from the date of transfer. Did you really do that?

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