Rights and responsibilities of a seller of the property

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When selling a property, it's crucial to understand your legal obligations. This discussion highlights potential issues with cash payments exceeding legal limits, which can incur significant penalties. Sellers must declare the full sale value for tax purposes and be aware of regulations regarding how payments are received to avoid legal trouble with authorities.

Chinnappan D M

Chinnappan D M (Querist)
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21 July 2022 I intend to sell my apartment for Rs.2 crores and the buyer is offering cash of Rs.60 lacs and the balance in cheque and agrees to register the property for 1.4 crores. I will remit the cash of 60 lacs into my bank account and declare as sale proceeds and calculate capital gain on total sale value of 2 crores and pay Capital gain tax on the total sale value of Rs.2 crores after indexation. Am I complying with all legal formalities? The registration department has agreed to register the flat for Rs.1.40 crores as per the guideline value of Govt. As a seller Will I encounter any problem with Registration department. Can any one clarify this

CA R SEETHARAMAN

CA R SEETHARAMAN (Expert)
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21 July 2022 You can register the property for 1.40 crore no problem.
But you can't accept cash payment for sale of property. Equal amount of 60 lacs penalty will be levied for accepting Cash payment in excess of 2 lacs under section 269ST.

Chinnappan D M

Chinnappan D M (Querist)
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21 July 2022 Thank you Mr Seetharaman for a candid reply. Can you also clarify what will be penalty amount if I accept the cash of 60 lacs?

CA R SEETHARAMAN

CA R SEETHARAMAN (Expert)
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21 July 2022 It's equal amount of 60 lacs penalty besides taxes.

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