INCOME TAX ON CIRCLE RATE

Save Share

This query is : Resolved

bishan singh negi (Querist)
Follow

23 January 2010 HI,

GREETINGS OF THE DAY,
MY CLIENT WANTS PURCHASED A PLOT FROM MR A @ 4000/- PER SQ.MTR. THE PLOT ALLOTED TO MR A BY HSIIDC .
MY QUERRY IS THE CIRCLE RATE IS IN THAT AREA OF RS 6000/-. MY CLIENT IS AGREE TO PAY STAMP DUTY ON CIRCLE RATE i.e. RS 6000/- AND ACTUALLY HE IS PAYING FOR PLOT 4000/- PER SQ. MTR.
ONE OF CA TOLD MR A THAT THE DIFFERENCE BETWEEN 6000/- TO 4000/- OF RS 2000/- WILL BE ASSUMED AS GIFT AND MR A WILL BE LIABLE TO PAY INCOME TAX ON 2000/- PER SQ. METER.
IS IT RIGHT OR WROUNG PLEASE

THANKING YOU IN ADVANCE.

CA Vijay Kumar Gupta

CA Vijay Kumar Gupta (Expert)
Follow

23 January 2010 The CA is right. Refer section 56 of the I. Tax Act with latest amendment effective from 1-10-2009.

C.A.Amitabh Gupta

C.A.Amitabh Gupta (Expert)
Follow

23 January 2010 That CA is right. Your client ( Purchaser ) will be taxed u/s 56(2)(vii) under "Income from other sources" for the difference of Rs.2000/- per sq.ft . Mr.A ( seller) will be taxed u/s 50C for capital gains for value of stamp duty as full value of consideration of plot sold i.e @ Rs.6000/- per sq.ft

Rgds
CA Amitabh Gupta
Indore
ag_ind@rediffmail.com

Message likes : 1 times

You need to be the querist or approved CAclub expert to take part in this query .
Click here to login now