My client purchase land from society of Rs. 500000/ in cash and pad stamp duty on Rs. 500000/, but society agreed to show only 12000/ actual consideration recived. Now in registy there are two value one is 5 lacs on which stamp duty paid & 2nd is rs. 12000/ which is shown as actual consideration received by society. After that my client constructed a house by incurring Rs. 600000/- & sold it in Rs. 1200000/-. Acutaly my client earn only 100000/ capital gain ( 1200000-1100000(500000+600000). Now he received a Notice from income tax department. What is cpaital gain in this case?
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Notice on capital gain
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It seems that society has purchased the house property out of the unaccounted cash as they are showing the value at Rs.12000 only against the consideration of Rs.5Lakhs. The difference amount i.e. Rs.4,88,000 will be treated as income from other sources if they were unable to explain the transaction.
land & building both will be considered separately for the purpose of calculating capital gains by considering their period of holding separately
land & building both will be considered separately for the purpose of calculating capital gains by considering their period of holding separately
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