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srinivas (CA final Student)     05 November 2008

capital gains on sale of flats


Mr.X being the owner of land has entered  into a Joint Development Agreement in oct.2007. His share in the developed property is 8 units. He has purchased the property in 2004 May. He wants to retain 2 units and sell the remaining 6 units.

What is the date to be taken for calculation of capital gains?

whether it is a short term or long term capital gain If Mr. X sells his property now(NOV.2008)?

Whether the date of the joint development agreement or date of registration of flats to be taken for the purpose of computation of capital gains?


 2 Replies

Brindha (Legal - Manager)     06 November 2008

Hi Srinivas,

In the above case of sale of 6 flats, the date of JDA has to be taken into consideration for the purpose of calculating capital gains.

The capital gain is short term since the transfer of property has taken place within a period of 36 months from the date of entering into a JDA.

However, the cost of index for the land to be taken seperately and it is the guideline value of the land at the time of purchase of the land ( March 2004 ) and the cost of index for the super built up area of the flat to be calculated for the guideline value of the building on the date of JDA.


asrao (NA)     16 December 2009


         I also want a solution to a very similar problem.can u pl  take a small example and calculate the cgt.This will be very helpful to me as there are different versions by different  lawyers

Regards                                                     asrao


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