Relingushiment of rent due to dispute in property sale

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This query is : Resolved

Querist : Anonymous

Querist : Anonymous (Querist)

10 November 2014 Short discription :-
The property was let out but owner of the prpoerty sold the same. The new owner sent notice to vacate but the tenent disagree. later both the party came to a settlement term. As per this settlement The tenent is allowed to continue for 4 month but with out rent after that he will vacate . Also a compaenasation will be payable for the furnitue & fixtures existing in the building.

what will be tax conseqenses of the above transaction
Is that taxable under HP of PG BP ?
Thanks in advance

Amol S Joglekar

Amol S Joglekar (Expert)

10 November 2014 In whose hands you are asking? Assuming it to be in the hands of tenant....it will not be taxable as it is CAPITAL receipt. Furniture and fixtures are personal asset.

Querist : Anonymous

Querist : Anonymous (Querist)

10 November 2014 form proprty owner side

thanks

Amol S Joglekar

Amol S Joglekar (Expert)

10 November 2014 No unrealised rent or relinquishment of rent is NOT taxable, as it has resulted into eviction of tenant. In the Memorandum of Understanding between new landlord and old tenant, it will be better if they mention this condition of 4 months stay without any rent.

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