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Occupancy Right
X company has given godown on rent from last 25 years to a Y proprietorship firm for business purpose. Now the X company wants to sale the godown to Z company for Rs. 10 lacs, The proprietorship firm also demands Rs. 2 lacs for vacating the godown. Whether Rs. 2 lacs paid by Z company to Y will include in the cost of acquisation of the property and cost will be Rs. 12 lacs. What will be the treatment of Rs. 2 lacs received by Y in his return of income. Whether Y can invest in REC bond to get relief.
Replies (1)
2 lacs will be the sale consideration to the firm for tenancy rights (capital asset).
he can invest in rec bonds
also the total COA for Z will be 10 lacs for building separately
and 2 lacs for tenancy rights
they are separate assets & hence separate costs
he can invest in rec bonds
also the total COA for Z will be 10 lacs for building separately
and 2 lacs for tenancy rights
they are separate assets & hence separate costs
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