Capital gains on sale of flat

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Viswasbhatt (Querist)
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28 July 2012 we were three owners of a flat. Me , my father and my wife. When this flat was purchsed in 2001-02 for 8.35 lacs, the loan was taken in the name of my father. The income tax benefit of loan was taken by my father. we have sold this flat in 2011-12. Now please let me know the tax treatment of the transaction in F/Y 2011-12 in the view of follwoing.

1)The flat was sold for 26 lacs and the sales proceeds were received as 12 lacs b y cheque and rest in cash.
2) The cheque of 12 lacs was received in my account only.
3) can i show this 12 lacs only the sale proceeds? what is the way the sale proceeds are calculated. If circle rate are higher and the registry is done on higher value then will i be bound to calculate the long term capital gain on circle rate or actual sales proceeds as mentioned in the sales deed will be applicable.
4) Also if no amount has been shown in my father and wife's account, will they be responsible to pay tax on capital gains.

5) I have purchased a residential land out of this 12 lacs through my bank. The land will cost me higher as the purchase price is to be poaid to the authority in installments. How can i take the advantage of this purchase in calculating exemption.

Please let me know at the earliest as last day of filing return is near.

Regards,

Viswas

CA Salman Mansoori

CA Salman Mansoori (Expert)
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29 July 2012 Thank you very much for asking a question
1. The cheque of Rs. 12lacs would be treat equally between all of you.
2. Indexation method would be followed to calculate the current purchase cost.
3. If the FMV is higher thn sales proceeds thn stampduty would be paid as per FMV.
4. Sales consideration in such case would be your FMV.
5. The amount paid during the year would be eligible and not the loan amount of land.
6. If your sales consideration is upto the amount paid for land during the year, thn there will not be any Capital gains.
7. Hoever if it your amount paid is less thn sales consideration thn LTCG would be applicable for the diff amount. i.e. Sales consideration - Amount paid during the year