Purchase of land

This query is : Resolved

ramana (Querist)
Follow

10 April 2015 HI, PROFESSIONALS

I PURCHASED AGRICULTURAL LAND IN THE NAME OF AGREEMENT SALE CUM POWER OF ATTORNEY IN RS. 15,00,000 ON 30.11.2005 AFTER THAT DEVELOPMENT OF LAND AND SOME PLOT OF LAND SALE. MY QUESTION PURCHASE OF LAND FIXED ASSET OR PURCHASE ACCOUNT IN PROFIT LOSS OF ACCOUNT DEBIT SIDE.

PLZ THIS MATTER VERY URGENT

CA John Abraham Austin ACA

CA John Abraham Austin ACA (Expert)
Follow

10 April 2015 If it is your stock in hand (if you regularly purchase and sells land), then it would come in your Profit & Loss A/c as purchase and sale.

Else, in the balance sheet as an asset.

ramana

ramana (Querist)
Follow

10 April 2015 THX SIR,

I HAVE PURCHASED 4 ACRES BUT I HAVE SALE ONLY 1 ACRE IN YEAR 2005-2006

CA John Abraham Austin ACA

CA John Abraham Austin ACA (Expert)
Follow

10 April 2015 You want to know about Income Tax treatment or just accounts ?

ramana

ramana (Querist)
Follow

10 April 2015 just account treatment

CA John Abraham Austin ACA

CA John Abraham Austin ACA (Expert)
Follow

10 April 2015 Then it should be treated as a sale of asset.
The purchase value to be taken proportionately. Since there is no depreciation, ignore it.

Now the entry would be:-

Sale of Land A/c Dr.
To. Land A/c
To. Profit on sale of Land Ac

On receipt of consideration,

Bank A/c Dr.
To. Sale of Land A/c

You need to be the querist or approved CAclub expert to take part in this query .
Click here to login now