capital gains

This query is : Resolved

Querist : Anonymous

Querist : Anonymous (Querist)

09 August 2010 how to calculate capital gain in the case of leasehold property trf to the landlord at the higher price (paggdi system)?
when the leasee given some money for right on the property by taking stamp duty?

CA.Amit Revankar

CA.Amit Revankar (Expert)
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09 August 2010 i m interpreting the fact of u r question in following way :
Mr.A(lessee) entered in agreement with Mr.B(lessor) to hire the land on rent. Furthur they have agrred that Mr.A will be constructing the building on the given land and use it for the agrred period and Thereafter the Mr.A will vacant the place and handover the building for nominal consideration.
From the above fact two question arise which have impact on taxation ;
1) Wther the Mr.B have charged less rent than actual considering the benefit of building or have charged actual(ALM) rent without considering the benefit of building.

Opinion :
In Second case - full value of sale consideration will be the amount received on trfer and same will be reduced from block to determine SHort capital gain or loss.

In first Case- Its a dicy issue, beacuse full value of consideration is what recd from Mr.B Plus concession in rent. It is difficult to compute full value of consideration but there are two way to deal. First identfy the rent benefit and compound it and another compute the STCG and incase of gain charge it and if loss, ignore it.