Please suggest possible solution for Following AY 2011-12 notice u/s 148 of Income Tax Act.
Client has sold inherited property worth 3.34 Crores, in which there are 32 other co-sellers/relatives. As consideration, client has received Rs. 19 Lakh from Builder stage wise in 3 years as follows :-
AY 11-12 Rs.9.2 Lakh
AY 12-13 Rs.9.8 Lakh
Out of these 19 Lakh, Client had received 5 Lakh for the co-sellers not having bank account. Also, the family members had been paid Rs.5 Lakh as share of Sale inherited property by client himself.
Also, half land is agricultural Land.
Firstly the amount of capital gain will be taxable in the A.Y. 2011-12 as tax is levied in the year of transfer of capital asset.
The amount of Rs. 5 lakh which assessee had received on behalf of his family members is not taxable in hands of assessee, therefore the amount of capital gain which will be taxable in the hands of assessee is Rs. 14 lakh i.e. (19lakh -5 lakh).
And further, as stated in the query that half land is of agriculture nature, therefore capital gain tax will be levied on 7 lakh i.e. 50% amount of capital gain.