04 June 2011
Mr.A died intestate on 01.05.2010, leaving behind him his wife, two major sons and 3 married daughters.He was the co-owner of one property(A) alongwith his son no-1 and also was also a co-owner of property (B) alongwith his son no-2. Both the properties were purchased in F.Y. 1985-86 After his death, his hiers(sons and daughters) relinquished their rights in both of the properties in favour of their mother. The properties were subsequently sold in the same financial year. Who is liable to pay tax? will relinquishment of rights attract tax liabilities? What will be the cost of acquisition for mother?
05 June 2011
1.IT WOULD HAVE BEEN BETTER IF THEY GOIFTED THEIR SHARE BECAUSE ANY TRANSFER UNDER GIFT IS EXEMPT FM CAPITAL GAINS TAX AND WOULD HAVE OUT OF CLUTHES OF SECTION 56 ALSO 2. IT WOULD HAVE BEEN BETTER IF U ENTER INTO A FAMILY ARRANGEMENT BY WAY OF MEMORANDUM OF FAMILY ARRANGEMENT SO AS TO DO AWAY ANY CHANCE OF TAX LIAB BEING SLAPPED THIS MEMORANDUM DOES NOT REQUIRE REGISTRATION IF U NAME IT AS "FAMILY ARRANGEMENT"
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