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Need details on Capital Gains on Flat in Gurgaon

Jugnu (Owner) (25 Points)

09 March 2010

Dear All,

My husband and me bought a flat on our names jointly in a resale from a seller in June 2007.

At that time the apartment complex was still under construction.We got possession of the same from the builder in Jan 2009.Now we would like to sell it by june 2010.How does the long/short capital gain imply in our case.is it calculated from

june 2007 or jan 2009?

Thanks!

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4 Replies

megha (Working ) (71 Points)
Replied 09 March 2010

It is the date of agreement and not that date of possession which is relevant for the purpose of determining the period of holidng for the purpose of calculation of short term or long term.

As the agreement has been entered in June ,2007 and planning to sold in jun,2010 , the period of holding is more then 36 months. So it will be LTCG and will be taxed at a concessional rate @ 20% + surcharge [sc], if applicable + cess @ 3% [education and higher education cess].

And u can save this tax by claiming exemption u/s 54 & 54 F

C.Balaji (Learner) (1867 Points)
Replied 09 March 2010

When was the agreement made??? Is there any Agreement to Sell drafted???

Please provide the details........

Rajat Singhal CA,CS,CFA (Senior Manager (F&A)) (254 Points)
Replied 09 March 2010

Dear,

Thanks for asking a very interesting Querry.......

You have mentioned in your querry that you have purchased the flat in a resale, please explain this statement properly and provide the details of the same.

Period of holding :-

The period of holding is taken from the following day of registration of property in your name till the immediately day preceeding the date of transfer.

So, in your case if registry is done in june,2007 and if you sell the same in June, 2010 the gain arising on the transfer would be treated as LTCG.

Thanks & Regards

Rajat

Jugnu (Owner) (25 Points)
Replied 09 March 2010

The property is park view city-2 on sohna road in Gurgaon.We bought it from Mr.Chahal who had bought it from Bestech (the builder).Call it a resale or a second sale.We didnt book it through th builder.We signed an agreement to sell with Mr.Chahal and then based to that Bestech transferred the property on our name in June 2007.

We got possession of the flat in Jan 2009 and the the registeration was done in court in March 2009.So what sort of capital gains apply to us as we want to sell by june 2010.We have taken a loan on it and also spent a lot of money on the woodwork.Would that be deducted from the taxable amount?

I have spoken to some property agents and they all are coming back with conflicting answers!

your expert advice will be very useful!

thanks.