Capital Gains in case of gift received

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Krishna Murty (Querist)
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30 September 2009 One of my claint was purchased a plot during the F.Y 2002-03 for Rs.1,50,000.The above said plot was given to his daugher as gift and it was registered for Rs.21,00,000 during the F.Y 2008-09. But the daughter was sold the above said plot for Rs.22,00,000 with in 6 months. What is the capital gains position in case of father and daughter.Kindly given advise.

Manmohan ACA, CS

Manmohan ACA, CS (Expert)
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01 October 2009 yes, it is capital gain in case of transfer by daughter.

In case of father transfer is not taxable by virtue of 49(1),,

in case of Daughter

sale consideration - ---------------22 lacs
Indexed cost of acquisition---------1.5 Lacs
(12 lacs * 632/ 632)
in short no indexation (see note)

---------------------------------- -------
taxable LTCG---------------------- 20.5 Lacs
-------------------------------- ---------
note that

(a)Capital gain Gain shall be long term capital gain , bcoz. if capital asset, which becomes the property of the assessee under the circumstances covered u/s 49(1) the period of holding of the previous owner is to be included

(b) stamp value derived for transfer is irrelevant.

c) Where an asset is acquired through any mode specified in sec. 49(1), then indexation benefit shall be available from the year when the current owner first held the property.

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Manmohan ACA, CS

Manmohan ACA, CS (Expert)
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01 October 2009 In shott Long Term Capital Gain of Rs. 20.5 lacs shall be taxable in hands of Daughter

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Krishna Murty

Krishna Murty (Querist)
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01 October 2009 Sir,
Kindly notice,
Short term capital gain Rs.10 lakhs, how was it arrived?. Rs 21 lakhs worth of property gifted to his daughter, the same was sold by daughter for Rs 22 lakhs. Then what is the capital Gain amount in the hands of the daughter.

Manmohan ACA, CS

Manmohan ACA, CS (Expert)
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01 October 2009 It IS LONG TERM CAPITAL GAIN OF Rs. 20.5 Lacs [in case of gift i.e setion 49(1) holding period of earlier owner is counted to determine the nature of asset i.e long term or short term ]

But indexation will be allowed from the year when the present owner ( Daughter) got the property

Third- It is registered for 21, 00 000 not sold, and for computing capital gain registered value of gift has GOT NO RELEVANCE

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