HEM@NT G@RG (ARTICLE ASSISTANT) (313 Points)
16 May 2014Hello Freinds,
I have an question regarding the capital gain,
An assesee has long term capital gain amt rs 60 lakh.
He purcahed a land for 40 lakh and deposited the rest money in capital gain a/c in bank and get exempted from the capital gain tax.
Now he come an contract with an bulider for making the 3 floors on land and take one floor as an consideration of the construction.
Plz tell me that tax Imlpication on the above.
answer should be appreciated.
Income Tax Wala: (Fin. Expert)
(Chartered Accountants)
(2015 Points)
Replied 17 May 2014
we can understand this query as following:
| long term capital gain | 60 lac |
| Less investment | |
| land purchased | 40 lac |
| cost of construction (assume from capital gain deposit a/c) | 20 lac |
hence nothing is taxable subject to that assessee will not transfer generated capital assets with in period of 3 years other wise previous exemption + new gain will be taxable.
now assessee has got the 3 floor constructed on that land than cost of each floor is 20 lac.
if he sold any one floor than previous exemption of rs. 20 lac will be taxable because he has transferred assets within 3 year.
Now come to next issue is now owner has sold one floor
| assume stamp value of floor SOLD say | 35 lac |
| cost of acquition | 20 lac |
| new STCG | 15 LAC |
NOW THIS NEW STCG 15 LAC AND PREVIOUS LTCG EXEMPTED 20 LAC WILL BE TAXABLE IN THE YEAR OF SALE OF FLOOR.
LET ME KNOW IF I AM WRONG
CAclubindia
