Interest on delayed sale consideration

Shweta (Service) (68 Points)

02 July 2008  

Dear All,

My Company has executed sale agreement for disposal of property 3 months before for Rs. 118 Crores. However there is delay in payment by other party. So we are charging 12.5% interest on the consideration.

Now my query is that interest what i am receiving from other party ... shall i consider it as interest (i.e. income from other sources) or should it be conidered as a part of my sale consideration (i.e. Capital gain)

An early reply is highly appreciated.


With regards

Shweta Maheshwari