Question ID : 21579

Taxability of Sale of Transferabel Development Rights (TDR)

An agricultural land situated within the Municipal Limites of Thane Municipal Corporation (TMC) was compulsorily acquired by Municipal Corporation for DP Road project. TMC has allotted Transferable Developement Rights and issued DRC Certificate to the farmer against the area of land acquired in the DP Road. Immediately farmer has sold DRC certificate to a Developer for a monetory consideration of Rs.1.20 Crores. Whether amount received by the farmer will be exempt from Capital Gain Tax? Is there any case law to substantiate the claim? Please provide valuable insights.

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