Regarding capital gain
This query is : Resolved
27 February 2013
An Individual purchased a land or Rs 1,00,000/-. He put it in partnership firm (Land Value 2,00,000 on that date). After some year he withdrew his property from firm (Land Value - 4,00,000 on that date).
Later he sold the property at Rs. 7,00,000.
What will be the position of income tax under capital gain. Please explain with relevant section and case laws,if any.
Thanks in advance
Later he sold the property at Rs. 7,00,000.
What will be the position of income tax under capital gain. Please explain with relevant section and case laws,if any.
Thanks in advance
27 February 2013
Capital Gain when Land transferred to firm :
Rs.1 Lac (2Lac - 1Lac).
Capital gain When property Sold :
Rs. 3 lacs (7 Lacs - 4 Lacs).
Rs.1 Lac (2Lac - 1Lac).
Capital gain When property Sold :
Rs. 3 lacs (7 Lacs - 4 Lacs).
27 February 2013
But when he put the land in firm he did not get any consideration then how gain can b 1 lac as u computed above ?
27 February 2013
he invested it as his capital.
27 February 2013
As per Sec 45(3), when Partner transfers capital asset than it is presumed that its value is as written in books of partnership firm.
And as per Sec 45(4), when partnership firm distributes assets its market value will be considered as Sales value.
And as per Sec 45(4), when partnership firm distributes assets its market value will be considered as Sales value.
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