For immovable property, capital gains tax is applicable and income tax is not applicable.
Therefore, now when R is gifting it to N and N is selling it to a builder (presumably) for construction of Flats and may be part of the consideration a Flat to be constructed besides cash. N has to pay capital gains tax if any. Capital gains tax is calculated on gifted/inherited tax as follows:
Value of the immovable property on the day of it was gifted/inherited
Value of the immovable property when it is sold
Capital gains tax shall be calculated on the differential amount minus the eligible deductions like taxes etc.
This is basically a forum for clarifying on matters of law but not for tax matters. Therefore,, i
t is better you consult a good Tax Consultatnt preferably a Chartered Accountant with full details so that you can be guided properly.