Transfer of immovable property by nri

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Roshan Thomas (Querist)
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27 June 2013
FACTS
A Non-resident Indian (resident of Saudi, Citizen of India) wishes to sell an immovable property for Rs 2.00 crore. The said property is an ancestral property and was inherited on parent’s death. The fair value of property to be taken as cost of acquisition is 1.00 lakh.
The property is not an agricultural land.
The purchaser is a resident.
The proceeds will be remitted to NRO A/c of the NRI and then to be repatriated to Saudi Arabia.
QUESTION
What is the rate at which the purchaser should deduct Tax at Source?
Form 15CB/CA In the event that purchaser does not deduct tax, is it sufficient that the said NRI pays self-assessment tax on long term capital gain?
Further say only a portion of the consideration like 50 lakhs is repatriated, then will Self-assessment tax proportionate to amount repatriated will be sufficient for issue of Form 15CB/CA ?
DTAA with Saudi Arabia
According to DTAA -Tax is leviable in the contracting state in which immovable property is situated.

gbalakrishnan

gbalakrishnan (Expert)
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28 June 2013 the buyer has to deduct tds of your capital gains under Longterm capital gains say 20% and he need to pay to income tax and give you the challan and the balance money can be remitted to your NRO A/C; YOU NEED TO INVEST IN ANDED PROPERTY/FLATS WITHIN 2 YEARS OR YOU HAVE TO KEEP TAX BONDS LIKE RURAL ELECTICITY cORPORATION BOND OR HIGHWAY ..BOND; YOU CANNOT GET THE CAPITAL GAINS TRANSFERRED TO SOUDI IMMEDIATELY WITHOUT TAX CLEARANCE CERTIFICATE. THANKS

Roshan Thomas

Roshan Thomas (Querist)
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28 June 2013 Thank you sir. However I would like the following clarification

Isnt Form 15CA/CB to be issued by Chartered Accountant an alternative to Tax Clearance Certificate by IT Dept ?

If the purchaser by oversight paid the full amount without deduction of tax, what is the remedy available to Seller

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CA. Anuj Gupta

CA. Anuj Gupta (Expert)
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30 June 2013 Form 15 CA and CB are required I the said transaction.

Make sure that funds are utilised to pay the due taxes.

Anuj
femaquery@gmail.com

Roshan Thomas

Roshan Thomas (Querist)
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30 June 2013 Thank you sir
Please advise whether 20% is the correct rate of tax ?
As per the DTAA with Saudi Arabia - the income is taxable in India only since property is in India.
My another query is whether any beneficial rate of tax is applicable on production of TRC by the seller ?? or these beneficial rate is available only for the prescribed payments of Interest, Dividend, Royalty etc...

CA. Anuj Gupta

CA. Anuj Gupta (Expert)
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30 June 2013 20.6%

No.......

Anuj