sivasubramanian (articled assistant) (79 Points)
09 September 2010I want to know which head of income is appropriate for the following nature of activity. An Individual buys a property (Land or/and Building) and enters into agreement of sale. Then the individual sells the property before registering the same in his/her name. So the profit that he/she derive from the above transaction should be shown as "Income from Business/Profession" or "Income from Other Sources"? If its under PFBP is maintenance of books compulsory?
Vicky
(CA, LCS,MCOM,)
(136 Points)
Replied 10 September 2010
if his activity is routine in nature,income wld be classified under PGBP........if not it will be taxable under CAPITAL GAINS..........it wont be taxable under INCOME FROM OTHER SOURCES IN ANY CASE.........books of accounts are required to be maintained if its a business activity and if the clients monetary limits fall under sec 44AA
Sunshine
(Helping All)
(10575 Points)
Replied 10 September 2010
capital gain will be attracted.....no books need to be maintained
provided this is not the business of the person....
Manoj BG
(Tax Professional and in Service)
(1795 Points)
Replied 10 September 2010
I THINK THIS COMES WITHIN THE MEANING OF ADVENTURE IN THE NATURE OF TRADE AND HENCE TO BE CLASSIFIED UNDER THE HEAD PROFITS AND GAINS FROM BUSIENSS AND PROFESSION. FOR MAINTENANCE OF ACCOUNTS, IF THE ASSESSE TOTAL TURNOVER OR NET INCOME IS LESS THAN LIMIT AS PRESCRIBED UNDER 44AA, THEN NO NEED TO MAITAIN ACCOUNTS. HOWEVER, IF IT NOT THEN IT NEEDS TO MAITAIN THE ACCCOUNT..
REGARDS,
MANOJ
CA.G.Muguntha Narayanan
(Internal Auditor at TVS Motors)
(2195 Points)
Replied 10 September 2010
Regristration is not relevant in this case. if its a regular activity, its business income. if not, its CG
danish dabir
(mumbai)
(218 Points)
Replied 10 September 2010
if the above client has business of buying and selling of properties then it will taxable under the head income frm BUSINESS & PROFESSION otherwise capital gain will be attracted.....no books need to be maintained provided this is not the business of the person...
Sneha
(Practicing Chartered accountant)
(65 Points)
Replied 13 September 2010
I guess it is capital gains...
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