Skip to content

CA Final · Direct Tax Laws & International Taxation · Income from Other Sources

Meera, a resident individual, purchased a residential plot from an unrelated seller for a consideration of Rs. 80,00,000. The stamp duty value on the date of registration was Rs. 90,00,000. What is the amount taxable in Meera's hands under Income from other sources, assuming no other facts?

Rs. 10,00,000 is taxable. The difference between the stamp duty value and the consideration is Rs. 10,00,000, which exceeds the higher of Rs. 50,000 or 10% of consideration, namely Rs. 8,00,000. Once the threshold is crossed, the entire excess is taxed, not only the portion above the threshold.

  1. ANil
  2. BRs. 10,00,000Correct
  3. CRs. 9,50,000
  4. DRs. 2,00,000

Explanation

Under section 92(2)(m)(ii)(B), the excess of stamp duty value over consideration is Rs. 10,00,000. The threshold is the higher of Rs. 50,000 or 10% of consideration (Rs. 8,00,000), i.e. Rs. 8,00,000. As the excess of Rs. 10,00,000 exceeds Rs. 8,00,000, the whole excess of Rs. 10,00,000 is taxable. Deducting the threshold (Rs. 2,00,000) is wrong because the excess is taxed in full.

Did you get it right without looking?

One question tells you little. A timed set on Income from Other Sources shows your real accuracy, how long you take and where you lose marks.

Practise Income from Other SourcesFree diagnostic mock

More Income from Other Sources questions