Sec 50- Long Term Capital Gain-Short Term Capital Gain, Income Tax

[SITARAM AGRAWAL]

1. Firm Purchased Premises in A.Y. 1977-78. Claimed Depreciation. Sold it in A.Y.2009-10
2. Can I divide the said Asset in Land & Building seperately

As decided by the Bombay High Court :

Commr. Of IT Vs. Citi Bank N.A. dt. 23-04-2003

261 ITR 570 , 134 Taxmann 467

      3. Can I substitute Value as on 01-04-1981 for Land for consideration of Long      Term Capital Gain  and Value as on 01-04-1988 for Building for consideration of Short Term Capital Gain. Being Sec. 50 has given effect

            w.e.f. 01-04-1988

      4.   Any other view or Case Law for above fact.

            Thanks

Sitaram Agrawal

Posts / Replies

[Krishnaswami Ramaswami]

Sir,

Land is not an depreicable asset and as such there is no such thing called  WDV on land.  Building is a depreciable asset.  The capital asset for which depreciation has been claimed  only be treated as Short Term Capital Gain.  I am of the view that consideration received on sale of land is to be treated as Long Term Capital Gain and the benefits can be availed accordingly.

Regards

RK