08 December 2011
DEAR EXPERT, it is land before 1981 on father's name 2 acres transfer to son from father after his death.so in this case land's cost is not available.now son had improvement & doing various related exp.in f.y.2009-10 like N.A Exp,stamp duty & other related exp is approx 90000/-.then after this land improved as resident plot and 6 plot sale totally 260000/- to different customers on f.y.2010-11.how show that remaining plot in books of a/c. sheet. will long term capital gain applicable. & how saw this process in I.T return of f.y 2010-11.pls solution on it.if son purchase new agri land will applicable LTCG?
sir, can you calculate with above figures how ex set tax payable or not? plz answer urgently
09 December 2011
First of all try to ascertain the fair market value of the land as on the date first acquired by the father. (Section 55(3)). Calculate the LTCG using the indexing up to the date(FY 2009-10) when the land is converted as stock in trade. For the FY 2010-11 calculate the business profit taking the FMV as on date of conversion as purchase price for stock in trade.
02 February 2012
Income can be treated as LTCG. Fair market value of 01-04-1981 and and cost of improvement with expenses in FY 2009-10 is to be consider for arriving indexed cost of acquisition for the land avaailable for saleble area under plot as per map. calculate capital gain from sale price received by deducting the indexed costr of acqu. of arfea sold. This will be liable for LTCG. If it is to be treated as stock in trade, such conversion will be treated as transfer. The fair market value on date of conversion will be deemed to be the full value of consideration received on date of transfer, even then the year of taxability will be the year in which the converted property is sold or transffered as stock in trade. In that year both capital gain and business profit from this will be exigible to tax. On date of sale property is NA land i.e. plot therefore benefit u/s. 54B will not be available.
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