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Long term capital gain/loss

Tax queries 542 views 1 replies

CA Sanjay Baheti

PROPRIETOR

1160 Points Joined January 2010

In case of my client being an Individual has sold Industrial Shed during F.Y.2011-12 for a Consideration of Rs.3,95,000/-.However its Purchase/Acquisition Cost is not known to Assesse as the same was purchased since more than 20 years back. also no other documentary evidence is available with Assesse for seeking any rough idea about its cost from Assesse.

Now How to determine the Indexed Cost of Acquisition/Purchase for the purposes of computing Long term capital gain/Loss as per I. T. Act,1961.

Replies (1)

V K Bajaj

Accountant

1540 Points Joined April 2012

As it is an Industrial Shed so assumption is that there were number of similar industrial sheds. Know the cost prevailing at the time of purchase from other occupier around the property.

However, at the outset it seems there is no capital gain in this case. During the past 20 years heavy renovation must have been done so accounting it with cost should not attract long term gain. To be more safe and strong advise your client to re-invest a part, say Rs. one lakh, of this sale proceed of Rs. 395000/-