INCOME UNDER HEAD CAPITAL GAINS
This query is : Resolved
08 March 2011
Suppose, a person under a contract with a Builder purchased a flat. But the flat is still under Construction. The person paid few instalments with interest to the builder ,but after 2 years the person sold that flat to somebody. Thus, whether the treatment should be done under Capital gains head or under head other sources for the profit on sale made? Whether it is necessary to be the owner of asset for treatment under head capital gains?
08 March 2011
For capital gains the assessee must have
right in the capital asset.
In this case, I assume that agreement to sale has been entered into between the builder and the contractor.
Further , as you have mentioned that the contractor had purchased the under construction property from the builder and sold the same in halfway to third party, it is a case of transfer of property,(it is not transfer of Residential House).
Short Term Capital Gains will arise to the contractor.
right in the capital asset.
In this case, I assume that agreement to sale has been entered into between the builder and the contractor.
Further , as you have mentioned that the contractor had purchased the under construction property from the builder and sold the same in halfway to third party, it is a case of transfer of property,(it is not transfer of Residential House).
Short Term Capital Gains will arise to the contractor.
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