CA. Naresh Jakhotia

TAX TALK-26.12.2011-THE HITAVADA TAX TALK BY CA. NARESH JAKHOTIA (Chartered Accountant) “ANCESTRAL PROPERTY PURCHASED IN 1936 SOLD NOW- INCOME TAX IMPLICATION” Query 1] We had an ancestral property purchased by our previous generation in 1936 and a house was built by them. My father and his 4 brothers were joint owners of the said property. After their death, their family members became the owners of the property. Now we sold the said property in Sept. 2011 for the total consideration of Rs. 277,44, 000/- & we (Total 18 members) received the consideration according to their ownership share. I am one of the co-owners amongst them and received Rs. 45, 77, 000/- as my share. Now please advise me the quantum of property gain tax, I am liable to pay. How it should be calculated? Is it to be paid on whole amount received? What are the ways to avoid the gain tax, how much should I invest in house property so as to save total gain tax liability as I wish to keep some liquidity with me. Wha...

TAX TALK-19.12.2011-THE HITAVADA TAX TALK BY CA. NARESH JAKHOTIA (Chartered Accountant) “RECEIVED NOTICE FOR ARREARS OF DEMAND!” Query 1] I have received arrear demand for the A.Y. 2002-2003 wherein the certain points as mentioned below were mentioned: · The amounts mentioned as outstanding demand(s) are liable to be adjusted against the refunds arising on processing of return in CPC. This may be treated as intimation u/s 245 of the Income Tax Act, 1961. · Please contact your current jurisdictional Assessing Officer for any clarifications on the Demand(s) stated in this intimation. · Any rectification/correction of the demand can be made only by the Assessing Officer. CPC cannot carry out any modifications to the above demands nor can it clarify issues regarding these demands. · In order to know your current jurisdictional Assessing Officer (AO) you may log on to http://www.incometaxindiaefiling.gov.in and click on “Know Jurisdiction” under “SERVICES”. This is for the financial year 20...

TAX TALK-12.12.2011-THE HITAVADA TAX TALK BY CA. NARESH JAKHOTIA (Chartered Accountant) “TRANSFER OF FLAT BEFORE SALE DEED: WHETHER CAPITAL GAIN OR BUSINESS INCOME?” Query 1] Till now, I used to deposit annually Rs. 40,000/- in my & Rs. 15,000/- each in the two PPF accounts of my minor children. Now, I wish to deposit Rs. 1 Lacs each in all the three PPF accounts. Is it permissible? What will be the tax implication of the principal and interest in the accounts of the minors? Your opinion will be highly appreciated. [Parantap Chandurkar- parantap2010@gmail.com ] Opinion: There is a limit on subscription in the PPF Account. Any individual may, on his own behalf or on behalf of a minor of whom he is the guardian, subscribe to the Public Provident Fund any amount not less than Rs. 500/- and not more than Rs. 1,00,000/- in a year. (The limit of deposit in the PPF A/c has been increased from Rs. 70,000/- to Rs. 1,00,000/- w.e.f 01.12.2011 vide Notification F.No. 1/9/2011-NS-II, dated 25-...

TAX TALK-12.12.2011-THE HITAVADA TAX TALK BY CA. NARESH JAKHOTIA (Chartered Accountant) “TRANSFER OF FLAT BEFORE SALE DEED: WHETHER CAPITAL GAIN OR BUSINESS INCOME?” Query 1] Till now, I used to deposit annually Rs. 40,000/- in my & Rs. 15,000/- each in the two PPF accounts of my minor children. Now, I wish to deposit Rs. 1 Lacs each in all the three PPF accounts. Is it permissible? What will be the tax implication of the principal and interest in the accounts of the minors? Your opinion will be highly appreciated. [Parantap Chandurkar- parantap2010@gmail.com ] Opinion: There is a limit on subscription in the PPF Account. Any individual may, on his own behalf or on behalf of a minor of whom he is the guardian, subscribe to the Public Provident Fund any amount not less than Rs. 500/- and not more than Rs. 1,00,000/- in a year. (The limit of deposit in the PPF A/c has been increased from Rs. 70,000/- to Rs. 1,00,000/- w.e.f 01.12.2011 vide Notification F.No. 1/9/2011-NS-II, dated 25-...

TAX TALK-28.11.2011-THE HITAVADA TAX TALK BY CA. NARESH JAKHOTIA (Chartered Accountant) “TRANSFER OF DEPRECIABLE ASSETS & EXEMPTION FROM CAPITAL GAIN” Query 1] I had purchased one office chamber in commercial complex in 1988, for Rs. 2 Lacs (WDV-2010, Rs. 27,000/-) and sold it this year for Rs. 32 Lacs. I am a senior citizen with income, from all sources, below exemption limit. Please tell me the tax treatment: a. Whether benefit of sec 50, 54 will be available or not? b. If not, what is the amount of tax to be paid? [yeshwant1938@gmail.com] Opinion: 1. You have sold an office block on which you have been claiming Depreciation. 2. Section 50 provides that where a capital asset forming part of a block of assets in respect of which depreciation has been allowed, when sold, if the full value of consideration exceeds the block value of the asset, such excess shall be deemed to be the capital gain arising from the transfer of short term capital assets. 3. In your case, probably, office ...

TAX TALK-21.11.2011-THE HITAVADA TAX TALK BY CA. NARESH JAKHOTIA (Chartered Accountant) “TDS CERTIFICATE NOT ISSUED DESPITE MANY REMINDERS & REQUESTS” Query 1] One of my relatives who is a Govt. employee, tax payer, purchased of plot in the year 1995 with a cost of Rs. 54,000/- and spent some money for boundary wall of Rs. 21,000/- (Total expenditure was Rs, 54,000/- + Rs. 21,000/- = Rs. 75,000/-). Now (2011), he has sold that plot with a cost of Rs. 15,00,000/-. My questions are as follows: 1. How much he has to pay the tax? 2. If he invests the whole money in MIS, or some bonds, etc, still he has to pay tax? 3. What are ways to avail the tax benefit? 4. If he purchases a flat/plot with the sale proceeds of his plot, still he has to pay some tax? 5. Is it called capital gain? I request you if you could guide something. [susantakumardutta@yahoo.com] Opinion: It is presumed that a) The plot is purchased in the FY 1994-95.(If it is purchased in F.Y. 1995-96, “259” used below shall be...

TAX TALK-14.11.2011-THE HITAVADA TAX TALK BY CA. NARESH JAKHOTIA (Chartered Accountant) “AMOUNT DEPOSITED IN THE PPF ACCOUNT OF WIFE: INCOME TAX IMPLICATONS” Query 1] I am 76 years of age and would have only the contributions to the PPF A/c as the category of investment eligible for Deductions U/c 80C, as the benefit of deduction on the Investments made in ELSS is proposed to be withdrawn from 1st April, 2012. I wish to contribute Rs. 30,000/- to the PPF A/c of my Spouse to claim the full benefit of Rs. 1 Lacs U/s 80C. However, I need clarifications and guidance with regards to: 1. Whether the contributions made to the PPF A/c of the Spouse will be treated as ‘Gift, and/or, attract the ‘Clubbing provisions’ as per the New Direct Tax Code, being introduced from 1st April, 2012? 2. If the ‘Clubbing provisions’ are applicable, whether the Interest credited every year on such contributions, on ‘cumulative basis’, is to be added to my income, as ‘tax-free Income’, every year? 3. Whether a w...