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bhjg (Querist)
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28 May 2009 I have two Query
1)If there is sale of residential flat and brokerage is paid whether it can be reduced from the sale consisderation to arrive a fianl amount to reduced from block

2)Can Interest paid on lease hold land for earlier year can be capitalised if in book it is booked on 1/04/2008 and paid on 31/12/08 than it will fall on 1ST part of year or second

kindly it is urgent

taxindiaconnect

taxindiaconnect (Expert)
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28 May 2009 1 The brokerage can not be reduced from the sale consideration to arrive a final amount to reduced from block as the expenditure is only a revenue expense and be charges to P & L Account. It can not be related to expenditure incurred before the capitalization of assets which are treated capital expenditure.
2 Any interest paid for acquiring a capital is a revenue expenditure and be charged to revenue. In your case it should be charged to revenue. No need to capitalize.