Interest on loan taken
This query is : Open
J ASHOK KUMAR
(Querist)
16 November 2010
Hi, If a loan is taken for purchase of a capital asset ( Land), can we include the interest and other charges paid for the loan as part of cost of acquisition and calculate Short Term Capital Gain accordingly?. The land is taken by an individual assessee and the same was sold within a period of three years and hence Short Term.
CA.Madhusudan B.P.
(Expert)
17 November 2010
Generally if a loan is taken for purchase of property it would be long term.
Since the loan was taken for puchase of Land & sold with in 3 years, it amounts to short term capital gain.
I assume that before selling the land the loan was cleared? & you want to claim the interest paid & preclourer charges to be part of cost of acquition, In my opinion you may not get this expenses as part of acquisition. But nevertheless you can try & claim as your Cost in acquiring asset.
Since the loan was taken for puchase of Land & sold with in 3 years, it amounts to short term capital gain.
I assume that before selling the land the loan was cleared? & you want to claim the interest paid & preclourer charges to be part of cost of acquition, In my opinion you may not get this expenses as part of acquisition. But nevertheless you can try & claim as your Cost in acquiring asset.
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