Capital Gain Tax on sale of Property to Company

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  1. atanu chatterjee

    atanu chatterjee New Member

    My mother in law sold a land to Coal India Ltd in response to their notification in 2015-16(FY) for Rs. 225000. The land was acquired by her mother through inheritance and passed down to her through inheritance. Incidentally both the ladies were single children. The land was sold on condition of employment (as per the resettlement rules of Coal India) and the person receiving the benefit paid my mother in law Rs. 1100000 by account payee check.
    Q1. What will be the taxable income and under which head. Indexation is not possible as we don't even know the date of actual acquisition.
    Q2. Will my father in law's interest income be clubbed. All the transactions are made to their joint account.
    Sincere suggestions from knowledgeable persons solicited , preferably before 5th Aug.

    The land in question is agricultural (baid land) but not been cultivated in the last two years.
     
  2. Karan Batra

    Karan Batra Well-Known Member

    1. This would be considered as Capital Gains. The cost of acquisition would be the Fair Market Value of the property on 1st April 1981
    2. No, the father in law's interest income would not be clubbed. Their respective incomes would be taxed separately in this case
     
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