Nature of Gain whether short Term or Long Term

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This discussion clarifies whether the gain from selling a flat is considered short-term or long-term. The flat was purchased under an agreement in 2017, with registration completed in 2020, and possession received in 2017. Despite the later registration, the key factor for determining the gain's nature is the date of possession. As possession was received in 2017 and the property was rented out, the gain on its sale in 2021 is classified as long-term.

Piyush

Piyush (Querist)
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15 July 2022 Assesssee has entered into an agreement to buy a flat in 2017. though registration was done in 2020. now, same flat is sold in 2021, whether the same will be short Term or Long term in Nature ?

Dhirajlal Rambhia

Dhirajlal Rambhia (Expert)
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15 July 2022 When was possession received?
Whether the agreement of 2017 was registered?

Piyush

Piyush (Querist)
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15 July 2022 Agreement was made on Rs 500 stamp paper in 2017.
Proper registration was done in 2020, stamp duty also paid in 2020.

Assessee got the possession in 2017 and had given the flat on rent. Rental income was also shown in ITR in all years

Dhirajlal Rambhia

Dhirajlal Rambhia (Expert)
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15 July 2022 The gain will be long term.

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