Sangeeth acquired a house property for ₹2,00,000 on 10th June, 1976. He incurred the following expenses to make some additions/alterations in the property: (a) Cost of construction of two rooms in 1983-84: ₹6,20,000 (b)

CS Professional · Advanced Tax Laws and Practice · PYQS · June 2021
Sangeeth acquired a house property for ₹2,00,000 on 10th June, 1976. He incurred the following expenses to make some additions/alterations in the property: (a) Cost of construction of two rooms in 1983-84: ₹6,20,000 (b) Cost of construction of first floor in 2004-05: ₹12,70,000 (c) Cost of alteration in the property in 2012-13: ₹9,60,000 Fair market value of the property on 1st April 2001, was ₹15,00,000 and it was sold by Sangeeth for ₹1,00,00,000 on 10th November, 2020. He spent ₹80,000 for the transfer of property. Compute the capital gain for the Previous Year 2020-21. (CII: FY 2001-02 = 100; 2004-05 = 113; 2012-13 = 200; 2020-21 = 301)

Answer & Explanation:

Computation of Capital Gain for the PY 2020-21 Particulars Amount (₹) Gross Consideration 1,00,00,000 Less: Expenses on transfer (80,000) Net Consideration 99,20,000 Less: Indexed cost of acquisition ₹15,00,000 x 301/100 (45,15,000) Less: Indexed cost of construction of first floor ₹12,70,000 x 301/113 (33,82,920) Less: Indexed cost of alteration ₹9,60,000 x 301 / 200 (14,44,800) Long Term Capital Gain 5,77,280

Topics: Income Tax Act, 1961

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