Capital gain

Well in my opinion, when few more flats owns by the same person under land development agreement, than his actual income is treated as in income frem business and profession as he/she deals in such no of flats property.

So no capital gains arises and no question for further reinvestment scheme. Any kind of doubts are welcome.

Thank You

It will depend on kind of the aggrement. If the land owner has transfered the possassion of land only the purpose of development/ construction and he is going to be the sole owner of the entire property after the development/ construction, it is not a 'Transfer' for the purpose of capital gain. 

However if, the entire rights in the property and the possassion is transferred to developer, and the land owner has received the Flats as a part of Consideration for  the land (consideration in kind) then it will give rise to 'Transfer' and consequently 'Capital Gain'  In that case the fair value of the flats will be added to the consideration. i.e. consideration received in money terms + fair value of the flats will be the total consideration.

But these flats cannot be treated as the Investment in New House Property for the purpose of claiming exemption , as it is the part of consideration and the land owner has not paid anything for these. Hence there is no investment flowing from the assessee (land owner) in the new house property.

There is no question of Busniess Income unless the land owner has undertaken the activity of acquiring the lands, getting them developed and / or sale of flats etc frequently. or it is an activity carried out with the objective of making profits.