One of my friend having his Ancestral land, and now on land he constructed a Residential Building. And sale the Flats of Building.. Then What about its Taxability???
And Construction is not business of him, Thus I think Land converted into Building can't transfered into STOCK IN TRADE. Whethere it is treated as Capital Gain???
01 May 2014
The query asked is not so simple as it looks on its face. . You may refer the following link : . http://www.indiankanoon.org/doc/152978292/
02 May 2014
If you refer the link then you would realize that lot of controversies can arise and until the matter is analyzed in-depth; it is tough to give any opinion thereon. . . From the link you will come to know that AO's opinion is always different than the assessee because he generally remains REVENUE minded. . . In my opinion, your case falls under A VENTURE IN NATURE OF TRADE. . However; if a single house is constructed and then sold; the case may be different than the existing case where so many flats have been constructed. .
CAclubindia
