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Long term capital gain on sale of apartment - reference date

01 October 2011

Pls clarify if someone books an apartment of Unitech in Gurgaon and after construction the conveyance deed done in Dec.2008 but as he dies immediately after registry, his daughter took possession of aptt in July 2009 as per possession letter of builder. Tell me 36 month will be taken from which date to be eligible for availing LONG TERM CAPITAL GAIN on sale of this apartment. Can it be sold in January 2012 i.e 36 months after Registry date or She has to wait till July 2012 i.e 36 months from Date of possession letter from builder to him.
An early views will be highly appreciated.

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4 Replies

CA Hardik Bunha (self) (2121 Points)
Replied 01 October 2011

hi,

My Friend yiu can sell your flat the gain will be LTCG. for term of period PREVIOUS OWNER'S CONVEYANCE DEED WILL BE CONSIDERED. U/S 49(1)

SAJAN DIDWANIA (owner) (47 Points)
Replied 01 October 2011

Dear Mr.Hardik,

Thnx for your reply.

I had been told by a few senior tax consultant as well as Income Tax officer friend too that without possession transaction did`nt completed hence only possession date will qualify as reference date not the conveyance deed date....

If u have any case law supporting your answer pls let me know i shall be obliged.

sajan

ashish gupta ( student) (1922 Points)
Replied 01 October 2011

possession is not the major condition. As per section 27 of IT ACT as well you are deemed as owner of property in part performance of transfer of properties act

SAJAN DIDWANIA (owner) (47 Points)
Replied 09 October 2011

Pls Give your Comments on Below response: dhiraj aggarwal,TAXPOINT (Director),9829551008 Says:

As per Section 49(1) read with section 2(42A) of income tax Act, period of holding should be taken from the date of possession of property in case of immoveable property