Menu
Indexed cost of house improvement
My sister bought a house in Kolkata in 2001 at Rs 8L and sold it during October 2017 at Rs 30L. Her capital gains comes about Rs 8L after taking into account the indexed cost of acquisition. She made some expenditure about Rs 1L in 2010 for woodwork /electrical fittings and flooring. But she misplaced all receipts/documents etc. Can she apply indexed cost of house improvement on Rs1L to reduce the capital gains?
Replies (3)
practically she can not apply due to misplaced documents because in case of assessment Ao may ask about it for proof
Well, in that case she is ready to pay the demand raised by IT. But the question is whether she will be otherwise penalised for claiming the deduction for the amount for which the supporting documents are misplaced?
There can be two suggestions for the same:
Theoretically: Yes, this will be against the law and statute to claim any deduction for which any documentary proof is not available. Also, if the case gets into scrutiny, a penalty can be imposed for furnishing inaccurate particulars.
Practically: Only 5-7% of the total cases are selected for scrutiny. Considering, the remote chances of assessment, it would be foolishness to not to claim the deductions. Also, it is not always necessary that the AO concerned will ask for documentary evidence for COI. In such cases, you can easily furnish some handmade vouchers and some bills. Then, It is all a game of luck.
Recent Topic
- Purchase return under gst
- Long Term Capital Loss - cannot be carried forward
- Cross-utilization of ITC between Trading and Resta
- Form 121 eligibility for non deduction of TDS for
- Gold/silver etf. STCG. how to decalre in ITR at s
- ITR-2 : cash income that does not fall under any h
- Debit note issued to supplier
- Ca pratik takkar imp list
- TDS EXECESS AMOUNT ADJUSTMENT
- What's the ONE thing about GSTR-2B / IMS reconcili
Related Topics
CAclubindia
