Corpus Fund From Re-development
Umesh
(Querist) 05 July 2010
This query is : Open
Dear Sir/ Madam,
A property under redevelopment fetches Rs 100 per member.Of which Rs 30 is corpus and the balance is Rs 70 that is the rent component spread over 3 years for the rehabilitation that the flat owners will have to manage with.
a)Since the Rs 30 is given in lieu with a
vision that the tax rates/ maintenance
will be higher once the owners move
into the new construction, should it
be in the first place considered as a
source of income and taxed as it bound
to perish and hence is an estimated
expense?
b) Wrt Rs 70, why would this attract tax
if its a provision paid in advance and
will be distributed over the 3 years?
In any and both the cases mentioned,there is no gain at all and hence the capital tax gain or short term tax again should not be applicable as there is no sale of plot/propert at all.Its purely a trade-off and I will seek your expert advice in this case as we are undergoing a circustance quoted above.
Thanxking You'll in Advance
