Is Asset purchased at a discount considered as Income?

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  1. Gaurang Agarwal

    Gaurang Agarwal New Member

    Yesterday I was going through casual income and I came across a problem which I am not able to understand please can anyone solve it?
    My Query is suppose I went to a car showroom to purchase a car worth costing Rs. 25 lakhs and the owner instead of taking Rs. 25 lakhs, he gave that car to me for Rs. 1 lakh so does that Rs. 24 lakhs is chargeable to tax as casual income? please provide me answer with detail reason
    Thank You.
     
  2. gaurav_kumar

    gaurav_kumar Well-Known Member

    No, this is not a case of casual income.

    If you have purchased an asset at a discounted rate - this is not a case of casual income and Rs. 1 Lakh would be recorded in the books as the cost of the asset purchased.

    However, in case you have provided the seller with some services/goods and entered into a barter system for exchange of goods/services - that would be recorded as income in the books.
     
  3. Gaurang Agarwal

    Gaurang Agarwal New Member

    @gaurav_kumar Sir in case if i am recieving that car free of cost then will it be considered to be casual income ?
     
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