CA Shahnawaz Shaikh (Practicing CA) (289 Points)
01 February 2016one of our client had paid Rs.25 Lacs to builder before 3 years and got Allotment Letter.
The Builder Constructed the Building and sold the flat to third party and refunded Rs 35 lacs to the client now
what will be the taxability of the Excess Amount Received i.e. Rs 10 Lacs
Venkateswar Reddy
(Audit Assistant)
(195 Points)
Replied 01 February 2016
it will be based on the cancellation policy and mutual agreement of the Builder Organisation and your client.
on otherhand it is looking like a pure financial transaction as if he gave as loan or investment. In this case Amount Rs. 10 lacs will be treated as Interst for 3 years.
CAclubindia
