We had paid ₹7,000 in 1997 under an SRA/Government rehabilitation scheme in Mumbai. Based on that allotment, we were allotted a flat in 2007.

At the time of allotment, no stamp duty or registration charges were paid, as the flat was allotted by the Government/SRA under the scheme.

Now, in 2026, we are planning to sell the flat for ₹40 lakh.

My queries are:

  1. Will capital gains tax be applicable on the sale of this SRA allotted flat?

  2. What should be considered as the cost of acquisition for computing capital gains?

    • Can only ₹7,000 paid in 1997 be taken as the cost of acquisition?
    • If yes, the capital gain would be calculated on almost the entire sale consideration.

  3. Since no stamp duty and registration charges were paid by us at the time of allotment, does that affect the capital gain computation?

  4. The buyer will be paying stamp duty and registration charges for the first time on this property. Does this have any relevance for calculating the seller's capital gains?

My main concern is whether capital gains tax is applicable in this case and what amount can legally be considered as the cost of acquisition. Any guidance from experts would be highly appreciated.