Propert sold at rs. 4000000

This query is : Resolved

Querist : Anonymous

Querist : Anonymous (Querist)

31 July 2011 we have sold flat hold in co-ownwership of two persons both have 50% share

now as per ITR all transaction above3000000 to be shown in AIR (annual information report)

if we show sales of40 lacs in AIR then my LTCG Calculation shows as my share value of 2000000 and if i show in AIR as 2000000 then as per stamp duty department they show as 4000000 in any one co-owner and in that case all my return is trated as concelling income and selected for Scrutiny without any my faults

i think its nowhere we can mention this types of facts so what to do?

beacuse in both case my return is treated as faulty only beacuse there is no place where i can give facts in any ITR

please suggest way

CA PARAS BAFNA

CA PARAS BAFNA (Expert)
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01 August 2011 In such cases you can argue by taking the help of Section 26.

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Even though it is related with IFHP but the manner in which a property's ownership can be establishment has been clearly defined in this section.
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Each co-owner sells his own share.
He is not receiving Rs 30lacs or more as he is selling a property belonging to him only for Rs 20.00 lacs.
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AIR reporting is necessary in this case for Purchaser. On the basis of PAN department will easily verify the vendors.
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So it is better, not to report in AIR.

Querist : Anonymous

Querist : Anonymous (Querist)

01 August 2011 suppose sales value is 8000000 and both co-owner gets 4000000 each then what? in fact as per previous experience ITO gets information of sales value of 8000000 and he select both cases for scrutiny as each one has shown sales value as 4000000.

CA PARAS BAFNA

CA PARAS BAFNA (Expert)
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01 August 2011 In the case which is "supposed" one,
AIR information are required to be furnished by both the co-owners and each one has to show40.00 lacs individually.
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If both the co-owners are under the
jurisdiction of same ITO, he can know from the facts available with him as he can easily conclude that 40+40 is equal to 80.

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ITO can scrutinize the case even if the seller is a single person and the amount shown by him matches with the purchasers'
transaction.

This is so because, the jurisdiction AO of purchaser and seller may not be the same person.
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The most important part of this discussion-

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If you calculate capital gains on the basis of 40.00 lacs and your AIR shows it 80.00 lacs,
smart officer at CPC can change your sales consideration to 80.00 lac and recalculate your capital gains accordingly.

In both the cases chances of extra heavy tax demands become bright.

After receiving the demands you have to initiate e-rectification procedure. Just imagine the difficulties in explaining the position without any physical supporting evidence.

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C A S.S.Agarwal, M.Com.,LL.B,

C A S.S.Agarwal, M.Com.,LL.B, (Expert)
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01 August 2011 You have to go by the deed of conveyance executed by you as one co-owner and the other co-owner is also appearing in the said deed and you must have shown the cost of construction equally.

If it is so then you can show 20L in your return.

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