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Real estate | income tax

Vinay (Student) (39 Points)

20 March 2016

Dear All One of my client has developed commercial building on self acquired property. During the year has has sold some of the space to bank say at Rs10000 and on the same floor to others at 4000. What will be tax implications as there is huge difference in selling rate.

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2 Replies

Max Payne (employed) (2569 Points)
Replied 20 March 2016

Well, since this is real estate business, it will attract section 43CA while computing PGBP. The stamp duty valuation (SDV) on the date of transfer will be full value of consideration in computing PGBP.

If any part of the consideration is received by mode other than cash - at the time of, or before entering into - an agreement to sell, you can take the SDV on the date of such agreement to sell, instead of the SDV on date of transfer.