wealth tax on land

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Mandavi

Job

23 Points Posted on 06 March 2009

Hi everybody,

Please clarify that whether value of land of a hotel company on which construction is going on is taxable under wealth tax Act after two years or not ?

Because in accordance with section 2 (ea) of wealth Tax Act, if a land is lying unused for two years is taxable as wealth.

Expecting promp reply.

Regards,

Mandavi Sharma

Company Secretary

Replies (2)

Guest

Posted on 10 March 2009

If no construction has been started, it will be taxable under Section 2(ea) as Urban Land...

However, if a construction is under process it will not be treated as land as it ceased to remain as unused land and being occupied any building constructed with the approval of the approved authority.

>>Vipul Garg

Mandavi

Job

23 Points Posted on 10 March 2009

Thanks Mr. Garg for replying. please also clarify that

Is there any criteria as to the minimum level of construction so as to get out of the purview of definition of urban land under section 2 (ea) of the Act and as such eligible for exemption from wealth tax e.g. building plan approved and digging started by the valaution date.

Regards,

Mandavi