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    Capital Gain Tax On Sale Of Property


    Dear sIR,

    Can you help me to get following answers with authorities and a copy of relevant details pl :-

    (a) I had taken a loan of Rs 3 Lac in 1995 from HDFC to buy a flat. I further took top-up loan of Rs 4 Lac against the same flat from HDFC. Will the loan amount paid back to HDFC (approx Rs 5.5 Lac), out of the proceeds of the sale of the flat be reduced, ie if the proceeds of the sale is Rs15 Lac, will Rs 5.5 Lac be deducted from Rs 15 Lac for calculating Wealth gain tax.

    (b) Can the gains from sale of property be reinvested in purchase of plot, if yes then what are the provisions?

    (c) If I reinvest the gains of the property for purchase of flat from Army Welfare Housing Orgnisation, what are the provisions for escaping Capital Gain Tax?

    (d) What are the provisions of financing part of the total amount required for purchase of property from personal loans ie personal loans from relatives and friends.



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  2. #2
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    Dr. Pathak
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    Hello,
    This is beyond the scope of RTI India, and I am moving this to 'chit-chat' forum, so that any informed member can respond to your query.
    Regards,

  3. #3
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    k r chakraborty
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    Re: Capital Gain Tax On Sale Of Property


    Quote Originally Posted by amarjitchandhoke View Post
    Dear sIR,

    Can you help me to get following answers with authorities and a copy of relevant details pl :-

    (a) I had taken a loan of Rs 3 Lac in 1995 from HDFC to buy a flat. I further took top-up loan of Rs 4 Lac against the same flat from HDFC. Will the loan amount paid back to HDFC (approx Rs 5.5 Lac), out of the proceeds of the sale of the flat be reduced, ie if the proceeds of the sale is Rs15 Lac, will Rs 5.5 Lac be deducted from Rs 15 Lac for calculating Wealth gain tax.

    (b) Can the gains from sale of property be reinvested in purchase of plot, if yes then what are the provisions?

    (c) If I reinvest the gains of the property for purchase of flat from Army Welfare Housing Orgnisation, what are the provisions for escaping Capital Gain Tax?

    (d) What are the provisions of financing part of the total amount required for purchase of property from personal loans ie personal loans from relatives and friends.

    Ans to (a) : Read these judgements . Your query will become clear.

    1)Amount spent for discharge of mortgage- No referable question of law could be said to arise from Tribunalís order holding that in case where property is mortgaged not by previous owner but by assessee himself, then amount paid to discharge mortgage debts could not be treated as cost of acquisition so as to allow same as deduction - V.S.M.R. Jagadishchandran v. CIT [1997] 93 Taxman 389/227 ITR 240 (SC)/CIT v. Roshanbabu Mohammed Hussein Merchant [2005] 144 Taxman 720/275 ITR 231 (Bom.).

    2)Payments by vendee to vendorís creditors - Where the assessee sold a mortgaged property, and the vendee paid a part of the consideration to the mortgagees and creditors of the assessee, the amount so paid is not deductible for arriving at the taxable capital gains, when it was not disputed that the mortgage had been created by the vendor-assessee. The amounts paid by the vendee to the mortgagees/creditors was paid as part of the consideration to the sale. It is untenable to draw a distinction between a case where the mortgage was discharged by the vendor prior to the sale and a case where the discharge of the mortgage was effected at the time of sale by payment of the outstanding amount to the mortgagees by the vendor - CIT v. N. Vajrapani Naidu [2000] 241 ITR 560 (Mad.).

  4. #4
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    ramesh patel
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    Re: Capital Gain Tax On Sale Of Property



    Quote Originally Posted by kushal View Post
    Hello,
    This is beyond the scope of RTI India, and I am moving this to 'chit-chat' forum, so that any informed member can respond to your query.
    Regards,
    we sold a plot in march htis year.we got 14 lack rupees.we invested in my house for modify.we have only one house in india.can we save capital gain.

  5. #5
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    C J Karira
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    Re: Capital Gain Tax On Sale Of Property


    Beyond the purview of this portal.

    Thread Closed
    Twitter: @cjkarira



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