ITR2- Long Term Capital Gain of property purchase in installment due to under construction

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Amiya Jana

5 Points Posted on 17 June 2023

I am confused when tried to fill Land or Building section of “Schedule Capital Gains” in ITR2. Online system is giving option only to fill “date of purchase/acquisition” and “Date of Sell/Transfer”. But what would be the “date of purchase/acquisition” when I brought flat in installment because it was under construction when i signed agreement with builder/developer ?

Here is my scenario:

I booked and signed on Sell Agreement with builder/developer on Dec 2010. I paid 1 Lakh during agreement sign with an alignment that my bank or I need to pay 10% with every floor roof casting . There were total 10 payments till Dec 2014 when all my dues to developer were paid by my or from my bank and flat was ready to move. They gave me possession letter on Dec 2014 and registered the flat on our name same time. During registration we spent all stamp duties and legal fees. Finally I sold this flat unit on last July 2022.

Please help to clarify, how to calculate Capital Gains in this case when in ITR2 only “date of purchase/acquisition” and “Date of Sell/Transfer” option available. Which date is correct for “date of purchase/acquisition” - Dec 2010 or Dec 2014 ? How to consider 10 prorata basis payments (2010 to 2014) in LTCG calculation? Thanks in Advance !

Replies (5)

Quick Summary

This discussion addresses confusion regarding the 'date of purchase/acquisition' for ITR2 when buying an under-construction property paid for in installments. The user signed an agreement in December 2010 and made payments until December 2014, when possession and registration occurred. They need clarification on whether to use the agreement date (Dec 2010) or the registration/possession date (Dec 2014) as the purchase date for calculating Long Term Capital Gains (LTCG) and how to account for the installment payments.

RITESH KUMAR BHAGAT

Student

110 Points Posted on 17 June 2023

Transfer takes place when Ownership , possession and register.
check Registered Copy in which stamp duty paid
you will find your answers
Registration is most important thing without registration can't say that we bought.

Mahesh Shah

2478 Points Posted on 17 June 2023

Date of allotment/ allotment letter by developer is date of acquisition

Amiya Jana

5 Points Posted on 18 June 2023

Thank You for your replies. Just curious in case, property sold before registration or allotment letter what should be “date of purchase/acquisition” for LTCG calculation ? In this example , agreement with builder happened on Dec 2010. Flat been sold after 10 installments on Nov 2014 before registration or allotment. In this case how to calculator long term capital gain in ITR2 ?