Implication of real estate transactions
This query is : Resolved
09 August 2013
Dear Experts
I have one query regarding purchase of a property.
I am going to purchase a property for a sum of Rs. 1 Crore. But the value of the property as per stamp duty valuation authority is Rs. 2 Crore. Please note that i am going to pay only Rs 1 crore & i am ready to pay stamp duty on Rs. 2 crore.
But i dont know the implications of income tax in above transaction. Please guide me so that i can purchase the property.
I have one query regarding purchase of a property.
I am going to purchase a property for a sum of Rs. 1 Crore. But the value of the property as per stamp duty valuation authority is Rs. 2 Crore. Please note that i am going to pay only Rs 1 crore & i am ready to pay stamp duty on Rs. 2 crore.
But i dont know the implications of income tax in above transaction. Please guide me so that i can purchase the property.
09 August 2013
There is NO tax implication on the buyer. So you do not have to worry about anything.
09 August 2013
Sir.. Thanx for your reply.
But i heard somewhere that the difference between (stamp duty value as exceeds the sale price) is chargeable under income from other sources.
By this i will be taxed Rs. 30 Lacs.
Please clarify.
But i heard somewhere that the difference between (stamp duty value as exceeds the sale price) is chargeable under income from other sources.
By this i will be taxed Rs. 30 Lacs.
Please clarify.
09 August 2013
That provision is applicable from 1.4.2014
It is NOT APPLICABLE at present.
It is NOT APPLICABLE at present.
09 August 2013
Sir it is applicable from Assessment year 2014-15. i.e. transaction from 01-04-2013 it will be taxable.
Please clarify.
Please clarify.
09 August 2013
Section 56(2)(vii) has been amended by Finance Act 2013. However the amendment will apply from 1.4.2014 and NOT from 1.4.2013
09 August 2013
Please refer the below link:
https://www.taxindiaonline.com/RC2/pdfdocs/wnew/finance_bill_18C_2013.pdf
go to page no. 18 point no. 11.
Most of the amendment in Union Budget lays its applicability w.e.f 01-04-2014. Does it mean that most of the amendments of finance Act 2013 is applicable from F.Y. 2014-15.
or it is applicable from A.Y. 2014-15.
Please clarify.
https://www.taxindiaonline.com/RC2/pdfdocs/wnew/finance_bill_18C_2013.pdf
go to page no. 18 point no. 11.
Most of the amendment in Union Budget lays its applicability w.e.f 01-04-2014. Does it mean that most of the amendments of finance Act 2013 is applicable from F.Y. 2014-15.
or it is applicable from A.Y. 2014-15.
Please clarify.
09 August 2013
Let me confirm and I will get back to you.
09 August 2013
Ok Sir waiting for your reply.
09 August 2013
Yes it is applicable from AY 2014-15. Got a little confused.
So, in this case Rs. 1 crore shall be deemed to be your income u/s 56(2)(vii) and accordingly you will have to pay tax on such income.
So, in this case Rs. 1 crore shall be deemed to be your income u/s 56(2)(vii) and accordingly you will have to pay tax on such income.
09 August 2013
Thanx Sir for your such a great response.
Now my 2nd query is as follows:
Income tax Act says that Sec 56(2)(vii)(b) is applicable to only individual/HUF assessee. now if we purchase the property in the name of newly incorporated company. Then what is the implication of sec. 56(2)(vii)(b) or any other section of the income tax Act.
Please clarify.
Now my 2nd query is as follows:
Income tax Act says that Sec 56(2)(vii)(b) is applicable to only individual/HUF assessee. now if we purchase the property in the name of newly incorporated company. Then what is the implication of sec. 56(2)(vii)(b) or any other section of the income tax Act.
Please clarify.
12 August 2013
Siddartha Bhardwaj Sir
waiting For your reply.
waiting For your reply.
12 August 2013
In that case there is NO tax implication in the hands of the company. The only tax implication is in the hands of the seller.
12 August 2013
Thank u very much sir. I appreciated your prompt reply.
13 August 2013
You are welcome.
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