I am owning 10 grounds of land and entered in to JV agreements with builder for 60:40 terms. That is i am owning 60% of the constructed flats. How do i calculate capital gain tax? Which year i should show in my return? Whether i am eligble to claim towards investment in building of house in my share of land. if so what will be the situation if I get 5 flats constructed by the builder .
Advise me
thanks
K.Anitha
Further to your query please find my comments below:
As per the JDA agreement if there is a transfer of developments rights in the land, this could be viewed as a transfer by the revenue authorities and would be taxable as capital gains immediately on signing of the JDA agreement.
Further there is a risk of AOPbeing formed between the developer and the land owner.
Therefore, even before entering into an JDA agreement request you to carefully on the above issues.
However, if you have looked into the above issues, the capital gain would arise on the end of the project. In that year you would show in the return of income.
For capital gains computation, the key factor would be computation of cost of acquisition. You can calculate the cost on a propotionate basis on the UDS you have given up.
Thanks
CAclubindia
