Taxability on Sale of tenancy rights
This query is : Resolved
28 June 2021
Whether an individual who is not the owner of the place selling his tenancy rights to the landlord (new) as he is been occupying the place since 1981 ie almost 40 years is now selling / surrendering his rights to the landlord for a consideration.
Note - new landlord has acquired all the other flats of the same building from the original landlord & other tenants.
Query
1. Whether consideration received will be treated under income from Capital Gain or other sources
2. IF under Capital Gain, whether indexation will be eligible & benefits of Sec 54 can be claimed, as there is no purchase agreement in our favour, only electricity bills are been paid by the assessee towards the flat.
Note - new landlord has acquired all the other flats of the same building from the original landlord & other tenants.
Query
1. Whether consideration received will be treated under income from Capital Gain or other sources
2. IF under Capital Gain, whether indexation will be eligible & benefits of Sec 54 can be claimed, as there is no purchase agreement in our favour, only electricity bills are been paid by the assessee towards the flat.
CA R SEETHARAMAN
(Expert)
29 June 2021
1 Consideration received will be treated as capital gains.
2 No indexation benefit. Sec 54 can be claimed if allotment letter is there
2 No indexation benefit. Sec 54 can be claimed if allotment letter is there
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