treatment on sale of land & bldg
This query is : Resolved
Have a lot to achieve
(Querist)
17 November 2009
an assessee purchased land on 1/1/2000 for rs. 10 lacs. on 1/10/2005 building was constructed on it (complete). the cost of construction of bldg came to rs. 15 lacs.
on 31/03/2006 the assessee charged dep on land & bldg @ 10% on rs. 25 lacs.
My first ques ie whether charging of dep on rs. 35 lacs including value of land is correct as land is not a depreciable asset.
second question is if the assessee sells the land & bldg on 31/03/2007 for 50 lacs ( 35 lacs for land & 15 for bldg) whether capital gain has to be bifurcated into STCG on sale of bldg & LTCG on sale of land
on 31/03/2006 the assessee charged dep on land & bldg @ 10% on rs. 25 lacs.
My first ques ie whether charging of dep on rs. 35 lacs including value of land is correct as land is not a depreciable asset.
second question is if the assessee sells the land & bldg on 31/03/2007 for 50 lacs ( 35 lacs for land & 15 for bldg) whether capital gain has to be bifurcated into STCG on sale of bldg & LTCG on sale of land
chetan soni
(Expert)
17 November 2009
Relating to your question:
on First : You can not claim the depreciation on land.
on second : As you said you have claimed the depreciation on the assets then depreciation assets are out off the provisions of capital gains chapter.
You need to treat this as business income.
on First : You can not claim the depreciation on land.
on second : As you said you have claimed the depreciation on the assets then depreciation assets are out off the provisions of capital gains chapter.
You need to treat this as business income.
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