Capital gains

This query is : Resolved

Querist : Anonymous

Querist : Anonymous (Querist)

25 September 2016 Mr. ABC has purchased land ( as Investment )in the year 2010 for Rs. 15.00 Lakhs.. He has converted this property into stock-in-trade on 1-6-2015. Fair Market value of the property on this day is Rs. 50.00 lakhs. Land was converted into plots. He has not sold any plot during 2015-16. He will sell plots in the year 2016-17 onwards. How to show these transactions in the Income Tax Return for Asst. Year 2016-17. How to fil the ITR for Asst. Year 2016-17.

Unnikrishnan B

Unnikrishnan B (Expert)
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25 September 2016 I can give you a general reply .in this case capital gain is applicable when the land is converted into stock in trade (50 lacs-15 lacs* indexation ).and when sold in parts proportionate sale to be shown in ITR in the year of sale.the sale price is more than the converted value of land then it is business profit

So you can show capital gain and business profit in ITR when the part of land is sold