The Reader

From: akmehra@vsnl.com <akmehra@vsnl.com>
Subject: Re: [aurangabad_ca] SALE OF NEWLY CONSTRUCTED BUILDING
To: aurangabad_ca@yahoogroups.com
Cc: moizjaorawala@yahoo.com, "akmehra" <akmehra@vsnl.com>
Date: Tuesday, 30 March, 2010, 3:28 PM

 

It is very important to see the intention of the person. Was it intended to carry on a business or was it to set up the building for renting or office use. The manner of keeping the accounts and the returns filed can lead to a fair conclusion. Was it shown as stock in trade or capital work in progress. Moreover assessed needs to hold the asset for 3 yrs after completion certificate to qualify for Long Term Capital Gain.
To answer the second part of your question, transfer of flats to partners will attract tax on profit ie fair market value less cost and to perfect title partners will need to incur cost of stamp duty and Registration and still hold flats for 3 years before getting benefit of LTCG tax.
You decide on the proper facts.
Regards
Ashok Kumar Mehra Co

Sent on my BlackBerry® from Vodafone

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From: moizjaorawala <moizjaorawala@ yahoo.com>

Date: Tue, 30 Mar 2010 06:17:00 +0000

To: <aurangabad_ca@ yahoogroups. com>

Subject: [aurangabad_ ca] SALE OF NEWLY CONSTRUCTED BUILDING

 

I would like learned members to guide me on the following matter:

A regd. Firm has undertaken a building project. It is the only project undertaken by them.

For some strange reasons, though building is complete, there are no buyers & bldg is lying vacant.

The partners are planning to sell the entire building.

Can the firm treat entire bldg. as investment and on sale of the same pay LTCG tax ?

or

Can partners take over total flats in the building as their individual investment and then claim LTCG ?

Will there be any deemed capital gain on above division of flats amongst partners?

I would request members to please throw light on above.
moiz