Accounting treatment of Conversion of a part of Agricultural Land to Commercial Land

Thaneshwar Jangid (Advocate Finance and Compliance Executive)   (27 Points)

08 May 2025  

A part of Agricultural land was converted into the Commercial land. At the time of recording this transaction in accounting,
1. will the converted land be revlaued as per the market rates, or
2. the acquisition cost will be bifurcated as per the area of conversion?

Also, what will be the tax related liabilties in this transaction?