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Question ID : 44611

Capital Gain on Development Agreement

Landowner has registered Development Agreement with Developer for area sharing basis in FY. 2023-24. The landowner and Developer will receive 6 and 8 flats respectively in the newly constructed building. The building is proposed to be completed in FY. 2025-26. If Landowner received booking amount towards some of the flats in newly constructed building. e.g. For 1st flat (Consideration - 35.00 Lacs) - Received Rs. 5.00 Lacs in FY. 2023-24. For 2nd Flat (Consideration - 35.00 Lacs) - Received Rs. 5.00 Lacs in FY. 2024-25. 1) Whether section 145(5A) applicable? 2) In which year, capital gain on land is taxable? - in FY.2023-24, 2024-25 or 2025-26? 3) The amount on which capital gain is taxable?

Posted by NAMRATA VIMALCHANDRA KASLAY on Feb 19, 2024

Filed Under Capital Gains

Answer ID : 85333

1) Whether section 45(5A) applicable? please read Section 45(5A), inadvertently mentioned as 145(5A)

Posted by NAMRATA VIMALCHANDRA KASLAY on Feb 19, 2024
Answer ID : 85334

Capital gain on land is taxable in the year when completion certificate is received. Capital gain is taxable on stamp duty value of flat less indexed cost of acquisition and on cash amount received.

Posted by CA. chunauti dholakia on Feb 21, 2024