Income from ancestoral property

R Bajaj (Querist) 17 December 2008 This query is : Resolved
Sir,
We are three brothers and we have decided to build our old house through a builder who has agreed to make a floor for each of us and also give me a sum of money as I will get third floor ( my Brother will get ground floor and first floor respectively).
My Querry:
The money I will get will be shown as what?
Is it income from sale of property?
How will I be taxed for this ammount?
How should I invest it and what documents do I need to produce to declare this as income?
Thanx
Bajaj

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Guest (Expert) 17 December 2008
Are you parting with anything, like share in the other part of the built up property or is it just the Builder will come and build it for you and pay money to you.

You are selling something for the builder to offer money. The sale will make you liable to capital gains tax, there is exemption on either purchase of new asset or investment in specified bonds. Better consult a CA or Tax consultant and plan your taxes.

R Bajaj (Querist) 18 December 2008
Yes Sir,
The builder is taking second floor and one parking space and the three brothers get one floor each.I will recieve money and will be getting third floor,but my brothers will get GF and First Floor and no Money.
Bajaj

Manish Singh (Expert) 22 December 2008
if the money is given by the builder then it will be taxable otherwise if you get it under the partition deed it will be considered as an amount inherited thus not taxable.

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