Land plot can consider as stock in trade or not ?

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monika (Querist)
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06 August 2016 IF AN INDIVISUAL ASESEE ARE DOING BUSINESS OF PURCHASE LAND AND AFTER PLOTING RESELL THEM ,SO QUESTION ARISES

1, INCOME OF THIS TYPE WILL CONSIDER AS PGBP OR CAPITAL GAIN ?
2 IF CONSIDER AS PGBP , LAND WILL CONSIDER AS STOCK IN TRADE OR NOT ?

3 IF CONSIDER AS CAPITAL GAIN STCG AND LTCG PROVISION WILL ALLOW OR NOT ?

Soumitra Basu

Soumitra Basu (Expert)
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07 August 2016 THE INCOME FROM THIS ADVENTURE WILL BE TREATED AS PROFIT FROM BUSINESS AND THE COST OF LAND SHALL BE TREATED AS EXPENSES

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monika

monika (Querist)
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08 August 2016 THANKS A LOT SIR FOR SOLVE MY QUERY
ONE MORE QUERY SIR

CAN A ASESSE PURCHASE A NEW LAND AS BUSINESS STOCK AND HOLD IT AS STOCK IN TRADE FOR LONG TIME , AND NOT TREAT IT AS CAPITAL ASSETS?

IF YES IT MAY BE WAY TO SAVE CAPITAL GAIN , WHAT IS RULES IN INCOME TAX ACT TO AVOID THIS TYPE OF CAPITAL GAIN TAX EVASION ?

Read more at: https://www.caclubindia.com/experts/modify_message.asp?entry_id=1096189

Soumitra Basu

Soumitra Basu (Expert)
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09 August 2016 YES, FROM THE VERY FIRST YEAR OF PURCHASE THE ASSESSEE HAS TO SHOW THE SAME AS STOCK IN TRADE. IMAGINE ABOUT LAND DEALING BUSINESS.

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