Sell of land plots

I don't think that would be possible as there are 3 different properties registered in 3 different people's name.

In the deed the seller will mention the cheque amount paid to each buyer and the TDS he will deduct.

Currently there are only two options available with them either invest in bonds or purchase a flat if they want to earn higher return pay the tax and invest elsewhere.

Yes account payee bank draft can work or electronic transfer. Yes in DD you have to mention in whose favour you are making this DD. Account payee cheque or DD would do.

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Thank you

Hello

1. It doesn't look possible to make a single registered deed after the partition deed.

2. The total sale proceeds would be divided into 3 of you proportionately according to each person's share and tax liability of each of you would be computed accordingly. In the deed, the share of each of you would be mentioned and payment method and amount would also be mentioned.

3. To get capital gain exemption and save tax on it, you have two options either purchase/construct a residential property or invest in 54EC NHAI or REC Bonds. Further to get higher returns, you can invest the sale proceeds elsewhere but then you might have to pay a higher tax on the capital gain.

4. Yes, Account payee DD would suffice the requirement. Yes, it carries the name of the seller.

I hope this answer satisfies your requirement.

Regards,

CA Hunny Badlani

Dear Sir,

Hope you are doing well !!

1. No, It is not advisable to make a single registered deed.

2. If the property is sold, each co-owner has to offer the capital gain as applicable on his share.

It may be noted that the apportionment shall be made at the ‘sale consideration’ and ‘cost of acquisition’ level and not at the ‘net taxable capital gains’ level.

So, in the case of long-term capital gains on sale of the jointly owned property, whether commercial or residential, each one of the co-owner shall be entitled to claim exemption under Section 54EC, by investing the indexed capital gains up to Rs 50 lakhs. So, the limit up to which investment in specified bonds can be made under Section 54EC, will be applicable in case of each co-owner and not for the property as a whole.

3.There is no other alternative ways other than 54EC Bonds and property purchase.

They need to invest long term capital gain in the below options.

a) Purchase of new residential house property within 2 years or construct within 3 years from the date of transfer.

b) Invest in to specified bonds as specified under section 54EC within 6 months from the date of transfer.

4.Yes, it is sufficient.

You can make a single deed with specifying the share of each owner in the deed.  The deed can be made between all the sellers and the purchaser.  To ease on the taxability, you can specify the bank account details of each seller and their portion such that the buyer would remit only the respective share to the individual owners bank account. 

As regards, the MV of the land, ideally alongwith the composite value, take separate valuations for each part.  If there is not much of a difference, you may divide the total MV into the share of inheritance.  For taxability, the IT Department will take the higher of MV or the sell price. Your mother needs to invest only the capital gains for tax exemption and not entire sales proceeds.

In case your mothers siblings are not interested in capital gains exemption, then there are several modes to earn income.  They can invest in shares or mutual funds.

Ideally, you should receive the part payemnst before execution of transfer.  Else, demand draft is the most suitable mode. 

1. Single deed is fine for tax perspective but you will have to properly show each member's share in deed very clearly.

2. Since the stamp duty value will be based on per sq.ft, you can demarcate the separate value for each property and mention in the deed.

3. Other than bonds, they can invest in another residential house property to save taxes.

4. Account payee deed is a good option. You can confirm other things from banker.

Hi,

- As the 9 siblings are the owner of single plot through partition deed which was in the grandmothers name. Execute the transaction on the single deed specifying the share of each of the three siblings.

- Yes, mention the share of each of the three siblings for easy and proper calculation of Income tax liability.

- For Income tax exemption, only two options are available as you have said otherwise there are multiple alternatives in which you would not get capital gain exemption.

- Account payee DD is the best option.

Thanks