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capital gains

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Priyanka Dubey (Querist)
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25 January 2011 At the time of purchase of property , advance maintenance was paid of Rs 150,300 which was included in the cost of acuisition. But at the time of sale a refund of advance maintenance was recieved OF rS 81,250. So can we include this in sale consideration and if not then what will be the correct effect to the adjustment????

CA PARAS BAFNA

CA PARAS BAFNA (Expert)
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26 January 2011 Correct cost of Acquisition of Rs. 10.00lac
But you have shown it to be Rs. 11,50,300.
Separate 1,50,300/ from it to arrive correct figure of Rs.10.00 Lac. 1,50,300 to be shown under " Advance Maintenance Paid A/c". Credit the account by the receipt of Rs. 81,250/ and transfer balance of Rs. 69050/- being expenditure on maintenance by debiting Capital Account.
(Assuming that the property is Residential House Property)

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