I booked a flat on 2009 with full payment made till 2013.... till now building is incomplete .....builder not in contact. ..yesterday builder calls and tells me that he is agreed upon returning my money Rs.20 lakhs with a compensation of Rs 8 lakhs
now my question is whiling filing itr where do I show this 8 lakh...and i read in section 57 iv that only 50% compensation is needed to be paid...help me in clearing the doubt ..if so does that mean il show only 4 lakhs
Kolkata Income Tax Applelate Tribunal in the case of Subhas Chandra Parmanandka (ITA No.1614/Kol/2010) held that income from transfer of right to purchase a flat is taxable as Capital gains. Compensation received over and above the booking amount is equivalent to consideration received on transfer of right to acquire property and is taxable under capital gains.
At the same time if the cancellation deed indicate the receipt as interest paid over the deposit amount, then the same will be added to your income under income from other sources, and will be taxed as per slab rate.
CAclubindia
