Interest on advance returned back
This query is : Resolved
07 February 2015
3 years back I purchased a entered into a deal to purchase a land and paid the seller almost full amount as advance, registry & possession pending. Now the seller is not ready to sell the same to me. Instead he is ready to pay me my advance money back along with the interest. Now what will be the tax treatment of such interest in my hands & also on the hands of seller??
07 February 2015
You have to show the interest income in Income from Other Sources. If seller is a businessman or dealing in real estate sector he will claim the interest paid to you as deduction in his P&L Account
08 February 2015
I'm still not clear about taxability in my hands. Dept can tell that canceled deal is relinquishment of right & can demand capital gain on interest received??
08 February 2015
Cancelled deal cannot be treated as Relinquishment of Right because Relinquishment of right occurs on property which has been registered in name of person who is relinquished his right.
There is little bit problem relating to concept.
Interest Recd.
by you on Advance will be considered Income under Other Sources.
There is little bit problem relating to concept.
Interest Recd.
by you on Advance will be considered Income under Other Sources.
08 February 2015
Agreement to sell do not confer any right in property , its always against the specific person with which you had an agreement. So there's no relinquishment of any right
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?
- REGARDING GST ON COMMERICIAL PROPERTY
- 15ca /15cb whose income tax login? remitter or nri seller's login?
- GST on export of services and Input Credit
- ITC temporary reversal and reclaim
- Regarding Documentation & Compliances for Opening of Unit of Pvt Ltd.
- RCM applicability on Rent Paid by Registered Person to Unregistered Landlord for Residental Building
- TDS U/S. 194NF
- Applicable TDS rate for sale of property in Nov 2024
- REGARDING 25 AS DATE OF PAYMENT AND DATE OF BOOKING
- Payment of bonus act - notice pay recovery
- MIS MATCH OF INVOICE NUMBER
- GST Regis.
- ITC c/f from FY2022-23 to FY2023-24 entered the same in table 8C of GSTR9 of FY 2022-23, in FY23-24
- Late filling fees Demand by gst office
- IGST Credit-Show cause notice issued-confusion
- Short and Excess provision of expenses
- Issue of gst e invoice
- Interchangeable words in accounts
- Adjusted profit/Loss in the case of LLP and Pvt. Ltd.company
Trending Online Classes
CAclubindia
