Long term capital gains
gaurav
(Querist) 16 June 2014
This query is : Resolved
sir, i have some ancestral agricultural property in outskirts of city. it is 100years old. If i sell it will i attract tax. it is semi urban village in tehsil records and has pradhan elected in it. though nagar nigam has included some villages , it is one of them. we pay agricultaral tax
R.K Nanda
(Expert) 16 June 2014
consult tax lawyer.
Anirudh
(Expert) 16 June 2014
As per Section 2(14) of the Income Tax Act, "capital asset" means property42 of any kind held by an assessee, whether or not connected with his business or profession, BUT DOES NOT INCLUDE—
"Agricultural land" in India, but that agricultural land should not be situate
(i) within 2 Kms. from the local limits of any Municipality which has a population of more than 10,000 but not exceeding 1,00,000; or
(ii) within 6 Kms. from the local limits of any municipality which has a population of more than one lakh but not exceeding 10 lakhs; or
(iii) within 8 Kms. from the local limits of any Municipality which has a population of more than 10 lakhs.
Now you decide whether your land falls within any of the 3 situations mentioned above. If it falls within the above limits, then even though it may be an agricultural land, still, there will be capital gains tax.
However, if your land, does not fall under any of the above 3 distances, then it will not attract capital gains tax.
gaurav
(Querist) 17 June 2014
thx, mr anirudh, but how is that 8 km distance calculated exactly. some say its shortest motorable road distance, while some say its crow flight arial distance
Anirudh
(Expert) 17 June 2014
It is neither motor cycle or scooter. It is measured aerially i.e. as a crow flies.
gaurav
(Querist) 22 June 2014
thanx again to all, but one thing i want to know that inheritence is tax free. eg if i receive 7 lakh rupees as inheritence it is tax free, in same way selling of land cant be tax free as it is inherited?
Anirudh
(Expert) 22 June 2014
The Rs. 7 lakhs which you receive by inheritence goes tax free, as it might have been already suffered tax at the hands of the person in whose hands the money was lying. Even there, if the money had come (in the hand of the person from whom you had inherited) by way of sale of any property, then he was liable to pay capital gains tax thereon. If not paid, it will be recovered from the legal heirs. Therefore, it is assumed that only that money which had already suffered tax is being divided and given as inheritance to the legal heirs, and hence it does not suffer tax once again.
But in the case or property which you inherit, since it had not suffered any tax earlier, it will suffer tax in your hands if you sell and make capital gain.
gaurav
(Querist) 22 June 2014
ok, can refund of tds on bank fdr be claimed for a deceased person from fy 2011 on wards when no IT return has been filed
Raj Kumar Makkad
(Expert) 22 June 2014
IT return is required to be filed even if the assessee has already expired so as to claim refund of TDS.
gaurav
(Querist) 28 June 2014
in case of long term capital gains, is it to be paid on circle rate? what will be status of money received which is more than circle rate. also, 5 km area around proposed dedicated freight corridor is to be notified as industrial by UPSIdA, the industrialists are supposed to buy that land and pay stamp fees on industrial rates and government would provide roads lights etc. then. Now if i sell land to industrialist, will i be paying capital gains tax on agricultural or industrial circle rates
Anirudh
(Expert) 28 June 2014
Dear Gaurav,
You are getting too much confused.
All that you have to first decide is whether your property is 'agricultural land' or not.
(What is agricultural land has been already indicated to you in my previous reply.)
Once you decide whether or not your property is 'Agricultural' or not.
If yours is not an ancestral property, then, it hardly matters to whom you make the sale - whether to an ordinary person, an industrialist or a Sultan of Emirates! - You have to pay the applicable Capital Gains Tax, unless you take steps to save the same by taking advantage of any of the provisions in the Income Tax which exempts from payment of capital gains tax - like investing in bonds etc.
Anirudh
(Expert) 28 June 2014
You asked another point - which I omitted to answer.
You wanted to know as to what will happen in case the consideration received is more than the circle rate for stamp duty.
In that case you will pay stamp duty on the actual consideration received. In case the consideration received is less than the circle rate, then you will pay stamp duty on the circle rate.
gaurav
(Querist) 14 August 2014
as per new land aquisition law , compensation is twice of circle rate in urban area and 4 times in rural area. what about land on outskirts of city classified as semi urban in records
Raj Kumar Makkad
(Expert) 15 August 2014
Such land shall either fall in the revenue record or in the city record and its treatment shall be accordingly. Generally such land falls within revenue record means it shall be treated as of rural land.
gaurav
(Querist) 14 March 2016
My land is notified under upsida. Now if gov't acquires will it give four times the industrial circle rate there?
T. Kalaiselvan, Advocate
(Expert) 20 June 2014
