corpus fund received from builder

[M. H. JAIN & Co.]

Dear friends & Seniors

 

I would like to seek your guidance for the following query related to redevelopement

of a Society Building

            a) Builder paying Corpus Fund to the Members

            b) Builder paying Corpus Fund to the Society.

            c) Builder paying Compensation to members for alternate accommodation till the

                construction of building is completed.

 

What shall be the Income tax treatment and implications in the above cases.

 

Regards

 

S M Jain

jai...@gmail.com

mhj...@vsnl.net

9821159343

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[Hemang Bhaven]

In our view,

 

1. Corpus Fund received to the Member will treated Under Long Term Capital Gain & the same will be taxed as compensation receved against the property or alternatively as gift received & will be taxed as normal income.

2. Corpus received to society is income to the society & will be taxed accordingly as normal business income.

3.  Compensation received for alternate accomodation will be shown as rent income under income from House Property.

 

Regards

Hemang Shah

--
Hemang & Bhaven (Chartered Accountants)
Room No. 10, Arvind Villa,
2nd Floor, Ghatkopar (West),
Mumbai - 400 086.
Tel. Fax: 2511 2752.
Mob.: 9223280298
Bhaven: 8097041002
Hemang : 9223273189

[shantilal jain]

IN MY OPINION CORPUS FUND RECEIVES BY MEMBERS SHOULD BE REDUCED

FROM COST OF ACQUISITION.

CORPUS FUND RECEIVED BY SOCIETY WILL BE TREATED AS INCOME BUT

RULE MUTUALITY MAY BE ARGUED

S.L.JAIN