capital gain in real estate development

This query is : Resolved

N Krishna Raj (Querist)
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11 July 2007 A, owner of certain land, enters into agreement with a Firm S for development of land into a housing complex. In that firm , Mr. A and his 3 sons are partners.
In that agreement, Mr. A will be alloted 4 houses on completion, in which he plans to live with his 3 sons.(each flat for each son and one for himself).

Firm employs a contractor for building the structure of the complex and plans to do the finishing jobs by a set of local workers in that area with materials supplied by the company.

Constuction is in progress.

Undivided share of land is not registered till now in the names of the customers, decided to do on completion of the work.

What is the income tax liability of Mr. A with regard to transfer of land?

Whether it should be treated as capital contribution in the firm or not?

If capital gains liability accrue, 4 flats alloted will be eligible for exemption under various section of the sections 54?

Land was purchased by Mr. A in 1968.