Agreement to sell property is considered as purchase??

This query is : Resolved

Sujan (Querist)
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09 April 2015 Dear Fellow,

I have a query regarding capital gain.
I want to have clarity whether agreement to sell or possession of property is considered as purchase for the purpose of capital gain??

If so which date is considered as date of purchase in case Agreement to sell is entered on 01.04.2014.

Possession of property is given on 30.06.2014

and property transfer document is executed on 30.10.2014.

Which date is considered as date of purchase for the purpose of capital gain??

Please advise.

CA. SHIVA SHANKARA R. SHETTY

CA. SHIVA SHANKARA R. SHETTY (Expert)
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09 April 2015 Agreement to sell is not considered for the purpose of capital gain. It is only agreement between the buyer and seller. It will not create any obligation between the buyer and seller.

However, possession can be considered for capital gain. While calculating the period of purchase, we can consider the date on possession or sale deed whichever is earlier.

Therefore, in your case, 30.06.2014 can be considered for date of purchase.