Immovable property
This query is : Resolved
30 August 2018
Dear Experts,
My query is regarding, Purchase of Immovable Property.
Mr. Ramesh (Buyer) purchased Immovable Property from Mr. Mahesh (Seller).
Details of Property : Market Value = 651000/- , Consideration Value = 437000/- (As per Sale Agreement)
Mr. Ramesh made Cash Payment of Rs. 220000/- and 437000/- by Cheque to Mahesh. BUT
Mr. Mahesh mentioned only 437000/- to sale agreement. (consideration Value) remaining 220000/- not consider in consideration value.
Situation is, Under valued property is purchased by Mr. Ramesh.
I want to know the taxbility in hand of Mr. Ramesh (Buyer) and Mr. Mahesh (Seller).
If Mr. Ramesh will pay tax NOW on 214000/- ie. ( 651000/- Minus 437000/-) by considering it "Income from Other Sources" ,than what will be effect of capital gain when Mr. Ramesh will sell the property.
Please help me expert to understand this situations.
My query is regarding, Purchase of Immovable Property.
Mr. Ramesh (Buyer) purchased Immovable Property from Mr. Mahesh (Seller).
Details of Property : Market Value = 651000/- , Consideration Value = 437000/- (As per Sale Agreement)
Mr. Ramesh made Cash Payment of Rs. 220000/- and 437000/- by Cheque to Mahesh. BUT
Mr. Mahesh mentioned only 437000/- to sale agreement. (consideration Value) remaining 220000/- not consider in consideration value.
Situation is, Under valued property is purchased by Mr. Ramesh.
I want to know the taxbility in hand of Mr. Ramesh (Buyer) and Mr. Mahesh (Seller).
If Mr. Ramesh will pay tax NOW on 214000/- ie. ( 651000/- Minus 437000/-) by considering it "Income from Other Sources" ,than what will be effect of capital gain when Mr. Ramesh will sell the property.
Please help me expert to understand this situations.
30 August 2018
I assume that the market value you refer here is the Guideline/Stamp value.
In that case, If Ramesh sells the property, the cost of acquisition will be the Guideline/Stamp value i.e 651000 here and not 437000.
In that case, If Ramesh sells the property, the cost of acquisition will be the Guideline/Stamp value i.e 651000 here and not 437000.
30 August 2018
One exception:
If Ramesh purchases the property as stock in trade, in which case, the consideration value 437000 will be considered for arriving the profit/loss on sale of the property
If Ramesh purchases the property as stock in trade, in which case, the consideration value 437000 will be considered for arriving the profit/loss on sale of the property
30 August 2018
Property purchase by Mr. Ramesh is consider as Capital Assest.
31 August 2018
In that case, Cost of acquisition will be the stamp value/guideline value
You need to be the querist or approved CAclub expert to take part in this query .
Click here to login now
Click here to login now
Similar Resolved Queries
Unanswered Queries
- Is this income indian or foreign income?
- RCM applicability on Rent Paid by Registered Person to Unregistered Landlord for Residental Building
- GST on export of services and Input Credit
- ITC temporary reversal and reclaim
- Applicable TDS rate for sale of property in Nov 2024
- Inventory of finished goods
- Should I report my US salary for January, February, March in Schedule FA?
- GST ON EXPORT COMMISSION
- Can we claim ITC of Feb-2024 in the month of November-2024 which was not claimed by oversight
- REGARDING 25 AS DATE OF PAYMENT AND DATE OF BOOKING
- Sale of property furniture sale
- Confusion around Form 26QB fields
- Adjustment entry in the case of Individual and HUF on 31st March
- Stock difference tax applicable on composite rate or normal rate
- LAST YEAR 2022-23 ITC IN NEXT YEAR 2023-24 REPORITNG IN GSTR-9
- MIS MATCH OF INVOICE NUMBER
- IGST Credit-Show cause notice issued-confusion
- Issue of gst e invoice
- How to adjusted advances given or receipt
- Foreign vendor without PAN unable to to register due to non receipt of OTP on foreign number ?
Trending Online Classes
CAclubindia
