Land Development Agreement :How Capital Gains Computed ??


The issue of charging capital gains on land being given to developers by owners remain a very controversial subject . The issue of time of charging capital gains and the computation of such capital gains remained topics of dispute between land owner and tax department. Courts have mostly held that capital gains arise in hand of land owner the moment conditions of Part Performance of Contract  under section 53A of Transfer of Property is fulfilled. This creates problem for many landowners as the liability to pay tax arises even before they get the real consideration in form of flats /house.

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