| Question And Answer | |
|---|---|
| Subject: | SEc. 45(5A) of Income Tax Act |
| Category: | Income-Tax |
| Querist: | manali B |
| Answered by: | Advocate Shashi Ashok Bekal |
| Tags: | Share in the project, transfer of share |
| Date: | September 22, 2022 |
1. Section 45 (5 A) of Income tax Act 1961 would not apply where the assessee transfers
his share in the project on or before the date of issue of the
said certificate of completion.
Issues :
1.Meaning of share in the project
-Is it interest in the project or
-Is it his share being land or building or
-both in the project
– Since Former would not require any specific identification whereas
the latter requires the completion of building as well as specific identification
2.Does the proviso apply only when the share in the project is
fully transferred or would it apply even if the share is partly
transferred?
pl guide
Section 45(5A) of the Income-tax Act, 1961 was introduced via Finance Act, 2017 for determining Capital Gain tax in cases where individual land holders enter into an agreement with the developers. It is a separate mechanism for computation of Capital Gains.
“share in the project” would mean interest in the project. The proviso would be triggered even if a portion of interest is transferred in proportion to the land & building transferred by the assessee. One has to study the development agreement to ascertain the correct principle of law .