Hello Sir, I have been using lawyers club app for years and all my queries has been answered. Thanks for that. Now I have come up with yearly tax filling issue.. My father sold a resident site 3 years back. Before he never evn registered or filling tax yearly. Now after selling site he is getting high value transaction 2018/19 SMS and it's from tax India telling to fill returns. Now the value of sold out was 45L and now it has been reinvested in house construction in 2020 please let me know if I need to ignore the SMS or need to file returns?
It is not known when your father purchased the vacant site and at what value. Your father needs to pay Capital Gains Tax on the profit made by selling the vacant site and there is a formula for calculating the profit. To get it calculated you need to take the assistance of a Chartered Accountant. Further, as per the existing procedure, if the entire sale proceeds are invested in fixed assets, your father can claim exemption from paying the tax on Capital Gains. Your father needs to file a return showing the number of sales consideration, calculation of capital gains, and proof of reinvestment in fixed house viz house and then claim exemption. IT Authorities shall peruse the information and permit the exemption.Therefore, as advised above, your father may contact a Chartered Accountant with all details and get the Income Tax Return filed seeking exemption applicable.