Hi,
I had an apartment 1, purchased & registered under my name in Aug-2003 & sold in Apr-2010. Since it was owned for > 36 month, the proceeds will be LTCG & can be saved if they are used for another residential property (House 1).
I had also booked another apartment 2 from builder (Sale Agreement for Land & Construction agreement executed on 05-Dec-2007) & paid the whole amount over last 3 years. Now before registration of apartment in my name, I am selling it via assignment agreement dated 06-Dec-2010 between me/buyer/builder.
Questions
1) Gains related to sale of apartment 2, are Short Term Capital Gain or Long Term Capital Gain? Pls note it was not registered in my name but Sale Agreement for Land & Construction agreement was executed. Possession was also not taken.
2) How gains are calculated? Is it Buy price - Sell price or something else. E.g. I have taken housing loan for apartment 2 & was not taking any exemption for apartment2. Buy price = 10,00,000. Interest paid = 2,00,000. Sale price = 15,00,000. So capital gain is 5,00,000 or 3,00,000.
3) If gains are STCG, what are avenues to save Tax ?
4) If gains are LTCG, can they be used in House 1, same house which is being constructed by proceeds of Apartment 1 or it has to be different residential property.
Thanks
Deepak
CAclubindia
