For computation of long run capital good points, we’re getting valuation achieved as on 1.4.2001 of a flat acquired by my father in 1999 in Chennai. It’s being achieved by a registered valuer. For this function, the valuer has taken the guideline worth as per the sub-registrar as on 1.4.2001. He has added 13% for the registration charge and stamp obligation relevant as on 1.4.2001 in Chennai. I wished your recommendation on whether or not the 13% might be added to the rule of thumb worth of land to reach at the price of land.
In case land or constructing has been held by you for greater than 24 months, any revenue made on sale of such property is handled as long run capital good points to be computed in prescribed method. For computing long run capital good points on sale of your property you need to scale back the listed price from the online sale consideration obtained. The listed price of an asset is computed by making use of the price inflation index, introduced for annually by the central authorities, to your price of acquisition of such asset.
In case the asset being offered was purchased or acquired earlier than 1st April 2001, the earnings tax legal guidelines help you undertake the truthful market worth of the property as on 1st April 2001. The earnings tax legal guidelines additional present that the truthful market worth as on 1st April 2001 can’t be increased than the stamp obligation valuation of the property as on that date. Stamp obligation worth can be known as circle charge or pointers worth in some elements of India.
Because the tax legal guidelines clearly present that the truthful market worth as on 1st April 2001, to be adopted as price of acquisition for belongings acquired previous to that date, can’t be greater than the stamp obligation worth, so even when the valuer provides you the valuation report with pointers worth as added by 13% of stamp obligation and registration expenses, it is possible for you to to take the rule of thumb worth solely as your price of acquisition for computing long run capital good points.
Balwant Jain is a tax and funding skilled and might be reached on jainbalwant@gmail.com and @jainbalwant on Twitter.
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