I Tax on Penallty Received

This query is : Resolved

SK Malik (Querist)
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09 August 2010 I booked a flat with builder in 2007 and signed buyer agreement.

Builder defaulted and not started the construction.

I moved to consumer court for refund.

After pressure builder agreed to refund the booking amount with Interest of 1% per month.

Now I have to sign

AGREEMENT TO TERMINATE CONTRACTUAL BUYER AGREEMENT
or
AGREEMENT TO SETTLE LAWSUIT OUT OF COURT.

PARTICULARS OF BOOKING AMOUNT PAID

Sep-07, 10 % on booking 271,250.00
Apr-08, 10 % on allotment 306,250.00
TOTAL TO RECIVE 796,787.84
ADDITIONAL AGREED 219,287.84

PL ADVISE ME, WHAT SHALL BE IN AGREEMENT FOR ADDITIONAL AGREED AMOUNT OF RS 219,287.84 SO THAT NO TDS OR Income TAX IN FUTURE TO ME. I never gave booking amount on interest.

GOOG WILL / PENALTY / COMPENSATION / LOSS COMPENSATION / COMPENSATION FOR MENTAL AGONY AND PHYSICAL SUFFERINGS / LITIGATION COST / OR ANY OTHER / CAPITAL ??????

Bhaskaran Chackrapani Warrier

Bhaskaran Chackrapani Warrier (Expert)
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09 August 2010 The additional amount, to my understanding, is in the nature of, under tax point of view, relinquishment of an asset which leads to capital gains.

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