Capital gains

This query is : Resolved

Querist : Anonymous

Querist : Anonymous (Querist)

28 October 2013 Dear sir/madame
My Query is about capital Gains.
Query:One of my clients got land as gift from his father(ancestors) (800sq yds)and he purchased some land from neighbour(200sq yds) and constructed flats in the land (1000sq yds) given and purchased and sold them. Whether it be taxed under capital gain income or business income. In earlier years of his returns he has not shown as capital asset. He is a civil works contract by business / profession.

CA Pallav Singhania

CA Pallav Singhania (Expert)
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28 October 2013 If he's converting such asset into Stock then both capital gain and business gain will be part of such sale..

Sale consideration- FMV = Business Gain

FMV- Cost of Acquisition = Capital Gain