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Taxability in case of sale of flats

Jay Agarwal ( CA Final) (207 Points)

07 July 2016

hello friends, I purchased a land in delhi for rs 1000000 and construct it by expending 2000000, as a result i get 3 unit of flats. In the same year I sold 2 units of flats for Rs 3200000, and one flat is still unsold. Please Explain the taxability.

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Harshit Kabra (INVESTOR) (Student CA final) (1113 Points)
Replied 07 July 2016

u will get an indexd cost of improvement from the year of such improvement to the year of sale, also u will get indexed cost of acquition from the date of acquired flat/constructed to the year of sale.

u will deduct all such cost of acquisition and improvement from the sale considertaion remaining will be ur liability.

further , if u will construct/purchase a brand new flat within 2 year of sale and before 1year of sale respectively then u will get exemption within section 50 series based on ur acquisition/construction.

so in ur case , ur purchase was yes within the 1yr of sale of such property for 32lac , so u will definately get exemption upto the cost or capital gain amount which ever is lower.

hope u will all clear from ur doubt

regards

harshit