An ancestral property purchased about 70 years ago that has many legal heirs, was sold by one of the heirs in 2003 to a third party without knowledge of other heirs. Other heirs lodged a court case against the heir who committed this fraudulent sale. Now, they have reached an out of court settlement whereby the sale effected in 2003 will be held as valid and each legal heir will receive a certain amount as total compensation for property sale plus cost of harassment suffered & lawyer fees incurred due to this fraudulent transaction.
Question is, whether there will be a capital gain in this case and how should the same be calculated in the hands of one of the legal heirs who is receiving compensation now?
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