Very urgent-capital gain

This query is : Resolved

Querist : Anonymous

Querist : Anonymous (Querist)

07 January 2016 if person has purchased land and incurred expenses on construction from taking loan fron Bank
After that he was not able to pay Bank loan then Bank has sold his property to third person without his approval

He Went for Supreme Court and won the Case and Court has given order to pay Lumsum amount to Third party to get back his Property.

now after that he has sold his property to other person

my query is this
1 when sales of asset has made
2 whatever he has paid to third party to get back his property it will be treated selling expenses....?????????/

praveen

praveen (Expert)
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07 January 2016 Income tax department will take the following stand, there will be 2 transactions of capital gains. Once when the bank sold it to a third person and second time when the person got back the property and sold it another party. You can claim the amount paid toward 3rd party as expenditure.

Querist : Anonymous

Querist : Anonymous (Querist)

07 January 2016 Sir, then who is liable for capital gain at the time of first sale
any case law u have regarding that......
can we refer case law CIT v. Chandulal Kamdar ,(121) vTaxman 2521(mad.) High Court
this is for Mortgage by conditional sale and transfer

Please guide me

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Querist : Anonymous

Querist : Anonymous (Querist)

07 January 2016 praveen Sir,

Please give reply with Case laws and sections

Querist : Anonymous

Querist : Anonymous (Querist)

07 January 2016 Praveen Sir then second time whatever amount we have paid to third party,it will be COA

CA CMA CS Ram Pavan Kumar Melam

CA CMA CS Ram Pavan Kumar Melam (Expert)
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09 January 2016 In my view the period of holding of the property is from the date of original purchase of property to the date of transfer made by him. The amount paid to third party is similar to repayment of loan. Hence, he cannot deduct the same from the property or consider it as cost of acquisition.

Also, in my view the department cannot consider as two transfers by dis-regarding the orders of Supreme Court.