Capital Gain on House Property
This query is : Resolved
26 July 2010
My client has acquired the Plot under Urban Development Authority. As per the Authority a open plot allotted, cannot be sold without construction of the Residential House.
My client has made an agreement for Rs.8 Lakhs for sale of Plot and the purchasers has to construct the Residential House on the plot at his own cost. Thereafter the House will be transferred to purchaser.
Now the problem is what should be the Sale consideration ? What will be the cost of Acquisition. and is there any other problems for source of House construction cost.
My client has made an agreement for Rs.8 Lakhs for sale of Plot and the purchasers has to construct the Residential House on the plot at his own cost. Thereafter the House will be transferred to purchaser.
Now the problem is what should be the Sale consideration ? What will be the cost of Acquisition. and is there any other problems for source of House construction cost.
26 July 2010
Sale consideration is 8 lacs only, since this is a violation of the actual agreement the agreement between your client and the purchaser is void - ab- intio.
However, once this agreement is executed then the sale consideration is 8 lacs only.
If your concern is about matching the market value of the land with that with one along the constructed building....
You need not worry about showing a higher consideration because, fixing of price for a property is absolutely the discretion of the owner and not governed by any law.
However, once this agreement is executed then the sale consideration is 8 lacs only.
If your concern is about matching the market value of the land with that with one along the constructed building....
You need not worry about showing a higher consideration because, fixing of price for a property is absolutely the discretion of the owner and not governed by any law.
Message likes :
1 times
28 July 2010
Thanks Sir,
Sir when the seller cannot sell the open plot he asked the Purchaser to construct the House at his own cost. after construction of House the Property will be transferred in the name of Purchaser. The seller will get only Rs.8 Lacs.
Now , while calculating capital gain the Cost of Construction of the House should also be considered and the source of Cost is not available with the Seller.
How to calculate the Capital Gain?
Sir when the seller cannot sell the open plot he asked the Purchaser to construct the House at his own cost. after construction of House the Property will be transferred in the name of Purchaser. The seller will get only Rs.8 Lacs.
Now , while calculating capital gain the Cost of Construction of the House should also be considered and the source of Cost is not available with the Seller.
How to calculate the Capital Gain?
29 July 2010
The cost of construction is 100% borne by the purcahser, so instead of fixing a different price, it would be ideal to take it at net 8 lacs.
Just find out the basic expenses like fencing etc... done by the seller which can be considered for computation.
When a deduction available is not utilised it will not be questioned.
We can goahead with 8 lacs net consideration.
Just find out the basic expenses like fencing etc... done by the seller which can be considered for computation.
When a deduction available is not utilised it will not be questioned.
We can goahead with 8 lacs net consideration.
You need to be the querist or approved CAclub expert to take part in this query .
Click here to login now
Click here to login now
Similar Resolved Queries
Unanswered Queries
- Tax on capital gains revoked us 54f
- Should I include march foreign salary received in April in my income for FY 2023-24?
- HSN Details in IFF/GSTR-1 & in GSTR 9
- Inventory of finished goods
- Confusion around Form 26QB fields
- Quiery in relation to GST liability in case of an advocate who has obtained GST registration.
- Filing of Form 10BB instead of Filing Form 10B
- Sale of property furniture sale
- Clarification on Documentation of Paid-Up Capital Contribution by Directors
- Applicability of Ind As to associate of associate
- TDS Deduction Online Learing Platform
- Point (III) 9 of GSTR-9C
- As per our records, find the below outstanding demand(s)* and interest payable u/s 220(2):
- Regarding transaction th. credit card
- MIS MATCH OF INVOICE NUMBER
- How to adjusted advances given or receipt
- Foreign vendor without PAN unable to to register due to non receipt of OTP on foreign number ?
- 133(6) DIN INVALID format error - ->WHERE TO REPLY 133(6) notice?
- Query for dubts
- CASE INTIMATION OF LIABILITY UNDER SECTION 73(5)(Rule 142(1A)
Trending Online Classes
CAclubindia
