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Zirakpur Urban Estate far from reality
Tribune photo by Amin War
Most of the colonies have a campus with security, wide roads, modern sewerage system and parks.
— Tribune photo by Neeraj Chopra
HUDA plans new sectors in Hisar
The ways of will
Labourers work in front of high-rise residential colonies in Gurgaon. The signing of the joint venture between Mukesh Ambani-led RIL and the HSIDC has raised all-round hopes of faster growth and development of this district. — Reuters
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Selling land, Reaping gains
The real estate boom has not just made property dealers and speculators cash-rich, but those in agricultural sector, too, have reaped rich gains. Lavishly-renovated houses and glistening luxury cars are not a rare sight in any village where the residents have seized the opportunities emanating from the boom. And it is not that the greenbacks have been spent on bettering the lifestyle. The far-sighted ones have invested in other ventures too which is fetching them regular incomes. A large number of them bought more land at cheaper rates.
Harmeet Singh from Gill village in Ludhiana says: “We sold part of our land, made two shops and raised godowns that would fetch us regular income.” To Harmeet, like most other agriculturists, the area of their land holding is important. “Reduction in land holdings not only dents the image of an agriculturist, but is something on which the farming community does not want to compromise,” he says. Hence, after selling off his land he is waiting for the prices to come down. “I would buy additional land as and when prices reduce,” he adds. The boom has made some agriculturists think of diversification in farming and also beyond agriculture-related activities that would help them supplement regular income. “Agricultural income is uncertain. Small landholders, in particular, suffer when climatic conditions are unfavourable. Property price rise has helped both small and big farmers,” says sarpanch Paramjit Singh of Talwara village. After selling part of his land, this enterprising farmer has started dealing in property. And while that continues, he would soon venture into floriculture. “A farmer would never dissociate from agriculture. I realised that it is the time to invest in areas like floriculture, something I would probably never have done without extra money.” Talking about those who invested in mutual funds and share market, he says: “A lot of people, I know, have sold land and invested money in capital market et al. However, I feel they lost because the gain in other investment areas has been less in comparison to property where the rise has been manifolds.” A visit to most villages in Punjab reveals how the property boom has improved the lifestyles. “After I sold off some land at a much higher rate than I had expected, I spent a lot on renovating my house, which looks grand now. I also bought a luxury car and am not the only one here to do that. Most of the kothis here look new, thanks to the rise in land rates,” says a farmer on condition of anonymity. Most farmers do not wish to reveal their investment towards luxuries. A lot of money, say dealers, has been used towards buying land at cheaper rates. As Manjit Singh Gill, another agriculturist discloses: “We bought more plots and land in rural areas. Ultimately, if I am to survive on agricultural income, I will have to increase the land holding to increase my produce,” he says.
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A village transformed
A countryside where every one is in a hurry to sell! Yes that’s what Devalhalli taluk where the upcoming international airport is coming up has become. Thousands of farmers have sold off their land since the last two years when the “gold rush” began. Hundreds more line the sub-tehsil office as well as the offices of property dealers at Devanhalli, to prepare papers for the land deals. The virtual gold rush began with the airport authority acquiring land for the airport. The farmers got an average of Rs 5 lakh per acre, which was more that the market price of their land. They also got money for construction and other development works done by them on their land. Most of the farmers went on to buy land further away from Bangalore and also branched off into small businesses. The countryside was to turn into a real El Dorado when construction on the airport started a year ago. The airport is coming up on one side of the road near Devanhalli. Property developers descended to purchase land from the farmers. Land prices have escalated since then from Rs 25 lakh per acre on the main road up to Rs 4 crore now. Land a little away from the main road is selling between Rs 40 lakh and Rs 80 lakh an acre. This has changed the villages in the Devanhalli taluk beyond imagination. There are Mercedes Benz, Accent and Scorpio parked on the driveways in the houses in some villages. Even a small non- descript house is likely to have a gleaming mobike or a scootie parked along side the adjoining cowshed. A visit to Tharabanahalli reveals a row of two-storeyed structures. “Farmers want to first construct the most palatial houses to announce their new-found wealth,” says Radha Nagraj, a social worker, who is camping in the village to spread awareness about water harvesting. Radha has a tough task on her hands. Farmers are more interested to rake in the moolah than listening to the ways of groundwater harvesting. Agriculture has become a thing of the past, says farmer M Murthy who sold off two acres, out of his three-acre plot at Rs 65 lakh per acre three months back. “I have invested the money to buy residential plots on the outskirts of Bangalore,” he says. What he does not disclose is that he has also built four additional houses in the village, which he hopes to rent out once the airport takes off. Average land holding in the area is around five to seven acres and those with extended families did not really get much money. With no occupation left to do, these people have spent money on lavish marriages, expensive houses and cars and motor cycles, gold chains, mobiles and watches. In an even more dangerous trend, it seems the farmers in villages around the airport will be bereft of land soon.
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Zirakpur Urban Estate far from reality
The ultra-modern Zirakpur Urban Estate, to be developed by the Punjab Urban Development Authority (PUDA) in Singhpura, Ramgarh Bhudda and Nagla villages to give a fillip to the planned urban growth, continues to hang in fire even as the farmers and elected representatives are up in arms against the government’s move.
The elected representatives of the area have again urged Chief Minister Amarinder Singh to intervene and stop the “forcible” acquisition of land by PUDA. In fact, the local MLA and SAD general secretary, Capt Kanwaljit Singh, has gone on record pledging “whole-hearted” support to the farmers. “The acquisition of land for the urban estate is a gross injustice to the residents and my party is with the farmers against the government decision,” the Akali leader says. With elections to the state Assembly nearly a year away, Capt Kanwaljit Singh’s reaction is expected. The run-up to the elections is likely to witness the politicians, cutting across the party lines, championing the people’s cause. However, the former state finance minister’s soft corner for colonisers is also well-known. The authority had already issued notices under Sections 4, 6 and 9 of the Land Acquisition Act, 1894, for the acquisition of about 200 acres in the first phase for the creation of a state-of-the-art urban estate on the strategic Chandigarh-Ambala highway. However, soon after the farmers opposed the move alleging that a majority of them are small and marginal farmers and PUDA is bent upon “uprooting” them. Another reason for the farmers’ opposition is that the compensation for the acquired land is “too less” and PUDA is adopting a “pick-and-choose” policy exempting lands of certain influential persons, alleges Mr Jagjit Singh Jaggi, coordinator for the villagers. Even the Zirakpur master plan clearly shows the proposed urban estate area in the Nagar Panchayat limits. Besides, the acquisition by PUDA is in violation of the Punjab New Capital Periphery Act, 1952, Mr Jaggi adds. It is being argued that with Zirakpur bursting at seams, the inclusion of the three villages in the Nagar Panchayat is a matter of time. If the villages are included in the Nagar Panchayat, private builders will step in to purchase the land at exorbitant prices. The anticipation of higher prices for the land is fuelling the farmers’ protests, sources say.
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A ‘metro’ in the Valley
What has changed the real face of Srinagar city manifolds over the past two decades is the growing urbanisation, shaping it as a metropolitan city with population growth beyond 10 lakh. The latest figures show that the population has grown from 8 lakh to 13.52 lakh leading to a heavy burden on the vital sector of basic amenities. “In an urban city, the rapid development part generally takes place where urban amenities are adequately placed,” comments an official here. “This is an urban chaos,” comments Mayor of Srinagar Municipal Corporation (SMC) Ghulam Mustafa Bhat. With this growth in population, a particular area along the 15-km-long bypass road between Athwajan and Parimpora has witnessed a tremendous growth in residential colonies and commercial establishments. “The bypass has ceased to serve the purpose of diverting traffic from entering into the city,” comments an official concerned here. The bypass connects Athwajan on the Srinagar-Jammu national highway, 7 km short of the central Lal Chowk, with Parimpora, connecting it with the highway leading to north Kashmir districts of Baramulla and Kupwara. The main reason behind the concentration along this area, according to the experts, has been the easy accessibility to all four major districts — Kupwara-Baramulla in north Kashmir and Anantnag-Pulwama districts in the south. This apart, the bypass road cuts through both Srinagar and Budgam districts that comprises the municipal limits of the capital city. It is equally distant from Lal Chowk, the nerve centre of the city, and the airport on the other side falling in Budgam district. An increase in the settlement of population from neighbouring districts, along the bypass here for want of basic amenities like water, power supplies, roads, education and healthcare facilities has led to growth of residential colonies and commercial establishments. An estimated 20,000 structures have come up in the area over the past two decades, says an official. It has led to a steep hike in the real estate value, particularly the cost of land. The bypass road area has turned into a major residential area along the road, which is being developed “generally illegally” into commercial activities. This has again enhanced the real estate value in the area, which ranges from Rs 30 lakh to Rs 50 lakh per plot of land along the area. These areas coming up, along the now posh bypass includes Nowgam, Baghe-e-Mahtab, Rawalpora, Hyderpora, Batamaloo and Parimpora, though the focus is on centrally located Nowgam-Hyderpora belt. In this stretch, particularly, a number of persons have also kept “land as reserved” property waiting for more and more escalation in the cost to get the most benefits. Instead of having bank deposits, there has been a growing trend of keeping land reserves to get more benefits, which has also led to an unaffordable escalation in the prices of land in the area. “This unoccupied and unauthorised hoarding of land by private parties also results in the escalation of real estate value,” another official says. The state government is without any policy to check the practice of using land as a commercial commodity and a “policy needs to be arrived at by the government to check the increase in real estate value”, says the official concerned of the Department of Jammu and Kashmir government.
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Ban on GPA to make deals in Haryana transparent
With an aim to bring transparency in the sale and purchase of apartments in Haryana, Haryana Urban Development Authority (HUDA) has now banned property transactions through General Power of Attorney (GPA).
The introduction of Haryana Apartment Ownership Act, 1983, approved in the review committee meeting of HUDA on June 29, will also help in controlling speculation in real estate prices. This will unearth those realtors and investors who have purchased several properties for speculation, through signing of GPA for the original allotee. According to the Act, all sale and purchase of flats will now be done through sale deeds. The move follows large-scale complaints of gross violation of the GPA in group housing societies. It has now been decided that all deeds made through the GPA will have to be registered as sale deeds. Estate Officers all over Haryana have been asked to examine all records and transfer such GPAs into sale deeds. The move will affect thousands of buyers and sellers in Gurgaon, Panchkula and Faridabad. Reasons behind the move
The General Power of Attorney (GPA) is a document whereby a person appoints another to represent him so that he can act on his behalf to carry out things like sale of property and handle court work. Any person above 18 years of age can execute GPA. Most of the transactions of apartments in the group housing societies in Gurgaon, Panchkula and Faridabad were done through the GPA. After seven years of possession, the occupant could get the property transferred in his name. However, because of the spiralling property prices, many owners started dishonouring GPA deals. In many cases, the original owners backed out of the deals and demanded the margin money (differential in price when the GPA deal was made to the latest price now). In some cases, where the person who had bought the flat through the GPA died, the seller would ask a huge premium from his next of kin to resign the GPA deal. Senior HUDA officials said that the Apartment Act has been adopted keeping in mind the concern for security of the occupants. “There will now be total transparency in the realty deals. Besides, the government will also earn additional revenue through stamp duty (7 per cent stamp duty is payable in Haryana),” he said. Realtors cry foul
Realtors, however, are not amused. They say that transaction through GPA was a convenient option. Several persons, mainly NRIs, those in defence services and other government officials posted at faraway places, who had purchased flats through GPA, cannot be present at the time of transactions. “The move has been orchestrated to increase the government revenue, at the cost of public harassment,” says President Haryana State Property Dealers Welfare Association Suresh Aggarwal. Property dealers deny that most of them had purchased several flats through GPA, for speculation. “Only 2 per cent of the flats would have been purchased by the property dealers. In Punjab and Chandigarh, sale and purchase through GPA is allowed,” says Mr Aggarwal. Realtors rue that the transaction of property has already hit an all-time low because of the frequent increase in collector’s rates by the state government. They say that rather than banning the sale of property through GPA, the collector rate should be decreased.
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Colonies dot Punjab-Haryana border
An interesting new trend in property growth is taking place in Ambala on the Haryana-Punjab border, particularly on the Naraingarh highway. Colonies are being developed in areas bordering Dera Bassi of Punjab, which have an approach road towards Ambala district. The colonies are being developed in Punjab since it is said that getting a licence is comparatively easier in Punjab than in Haryana. So, the developers are able to develop a licenced colony, which cater to the residents of Ambala in Haryana. Projects like Dreamland Colony, Defence City and Omaxe Greens have come up in Punjab even though they are practically an extension of Ambala. The new projects are helping in filling a void for well-planned colonies, which have proper wide roads, sewerage, water and street light facilities. The lack of facilities in authorised as well as unauthorised colonies in Ambala Cantt and Ambala City are proving to be a big draw for the new colonies, which have come up on the Ambala-Naraingarh NH72 highway. As a matter of fact, Naraingarh highway is becoming a new property destination. The new projects are coming up ahead of Panjokhra Sahib Gurdwara. Property consultants believe that in the long run, the new projects after completion will lead to further growth in the area. They point out that the Naraingarh highway, a stretch of which passes through Patiala district before re-entering Ambala, is suitable for property development due to easy accessibility. The highway is approachable from Ambala Cantt as well as Ambala City. Many of those who have bought plots in the new colonies are exasperated with living in areas where civic conditions are unsatisfactory. Plot-holders are keen to lead a better quality of life. The distance of the colonies from the main areas of Ambala Cantt and Ambala City along with the prices of plots is said to be a deterrent for some. Even though, some people have evinced interest, they have decided against buying plot in the new colonies due to the distance they would have to travel to reach the colony. The developers point out that the pricing is nominal when compared to the facilities being offered by them. Dreamland Colony, which is one of the first to come up in the area on the Naraingarh highway, has been developed in Himayupur, Dera Bassi. Defence City, which is located a short distance ahead of Dreamland Colony, is likely to be developed in four or five phases over a total area of 50 acres within a span of two years. Omaxe Greens is located on the Ambala-Chandigarh highway near Chaman Vatika school. Omaxe Greens is offering flats. There will be 600 apartments in 10 blocks, including two-bedroom and three-bedroom apartments.
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HUDA plans new sectors in Hisar
A silent revolution in real estate development is in the offing in the historical city of Hisar. While on the one hand, Haryana Urban Development Authority (HUDA) has initiated the process for development of seven new sectors in the district, private colonisers have also evinced interest in the city.
Moreover, a number of developmental activities, including interlinking of bypass roads, construction of railway overbridges and flyovers and four-laning of the Hisar-Delhi national highway are in the pipeline. The procedure for acquisition of land has already begun for Sectors 23, 24, 25 and 26 to be developed by HUDA in Hisar. HUDA Sectors 5, 6 and 7 are going to come up in Hansi township. There is a move to develop a residential sector in Agroha township in Hisar district and bring Adampur and Barwala under the control area plan. Besides, the Daffodil Group has applied for 80 acres of land in Hisar, while Lakshmi Narayan Builders has sought permission to develop 28 acres of land in Hansi township. A few other colonisers are also conducting surveys. During his recent visit to the city Haryana Chief Secretary Prem Prashant disclosed that a prospective plan envisaging the city’s future development was being finalised. The plan included specific thrust areas like linking all bypass roads surrounding the city, construction of railway over-bridges and flyovers.
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The ways of will
Transfer of ownership title of the assets and property left by the deceased in the name of his legal heirs is known to be the transfer by succession. Generally, law has its own procedure while transferring the ownership title of the property left by the deceased in the name/s of one’s legal heirs by duly verifying their antecedents. However, the owner of the property has the right to execute a will identifying assigning the beneficiaries of his choice while specifying the ratio of their respective shares of his self acquired assets /properties. To be on the safer side to avoid any litigation and dispute later on over the authenticity of will, the document is, generally, preferred to be got registered in the office of the sub-registrar of the area. Such a will, executed and registered in the presence registering authority, is known as Registered Will. However, a will can be in a shape of a verbal statement or a written testimony supported by, at least, two witnesses of the persons of repute, social status and standing. Such a will is called unregistered will. And if a person dies without leaving any will, it is called interstate death. Last & final will supercedes all previous will/s. Executing
Will law permits each one having a sound mind and in one’s full senses, to execute will during one’s lifetime. Giving full details of the self-acquired assets, movable as well as immovable, the testator of the will identifies the beneficiaries and specifies their respective shares. Due diligence, about mentioning the proper identity of the beneficiaries, should be taken to avoid any confusion later on. Beneficiaries are not necessarily to be the legal heirs or the blood relations of the executant; they may even not belong to the deceased family. Two witnesses are required to attest the execution of will in their presence. The will is executed on a plain paper. A registered will to be made in duplicate (photographs of the testator on both copies) is executed at a nominal registration fee by the testator by presenting himself, along with two witnesses, before the registering authority. Categories
Legal heirs are normally categorised into four categories. Mother, wife & children of the deceased male comes in the A category of legal heirs, whereas husband and children in case of a Hindu female falls under this category. In the event of none of the legal heirs of category A is alive, the assets are distributed equally among legal heirs of Category B comprising brothers, sisters and father of the deceased male and parents- in-law, brothers & sisters of her husband in case of married Hindu female provided that the property and assets has been inherited by her from her in-laws. However, if the property has been inherited by her from her parents than the assets shall be transferred to the parents’ side after her death provided that none among her children and husband is alive to stake claim on property. In case none of the legal heirs of both categories mentioned above are alive to stake the claim than the ownership of title of assets and properties left behind by the deceased gets transferred to the third category, which is further categorised into two categories namely “agnates” and “cognates”. Agnates are the nearest kin among the blood relations/adopted from male’s side and cognates are the nearest kin among the blood relations/adopted from female’s side. A female member shall be the last link of chain of descendents among the agnates as well as cognates category. In case any one of the legal heirs of a person predeceases him then wife and the children of the deceased beneficiary shall automatically be the legal owners of his share of properties provided that the assets and properties are inherited and not self-acquired one. However in case of self-acquired assets the possessor/owner has full right to declare the beneficiaries of his assets after his demise in a will during lifetime. The writer is a Chartered Engineer
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SEZ thrust for Gurgaon
The signing of the joint venture between Mukesh Ambani-led RIL and the Haryana State Industrial Development Corporation (HSIDC) for setting up the world’s one of the largest Special Economic Zone (SEZ) on 25,000 acres of land spanning from Garhi Harsaru in Gurgaon district to Jhajjhar has raised all-round high hopes of faster growth and development of this district.
The general public, including the farmers, are apparently not much bothered by the ruckus raised by the opposition parties who allege total sell out on the part of Haryana to the industrial house. The farming community feels that the Haryana government has decided to give RIL only 25 per cent of the land required for setting up the project. With the Haryana government already fixing floor price in the state, including in National Capital Region (NCR), the industrial house will have to purchase the rest of the land at a price, which would be dictated by the market. Earlier, the operators, in collusion with a section of the functionaries of the state government, would manipulate to grab their land at throwaway prices. The SEZ is the best thing to have come the farmers’ way; especially those who wanted to sell their land. According to the functionaries of the HSIDC, RIL will set up a captive power plant of 2,000 MW in the SEZ. With the state already hard pressed for power, this captive plant will certainly boost the power supply to all sectors. The government version is that as per an agreement, the power generated in the SEZ will have to be supplied here. The general feeling is that with the signing of the SEZ, Gurgaon now stand streets ahead of other upcoming satellite towns in the NCR. Those who feel this way are of the view that there was a debate on the superiority between Gurgaon and Noida. The optimism is grounded in the reasoning that the SEZ is solely related to infrastructure development. The view doing rounds in the official circles is that the entire project would pump in investments worth about Rs 1 lakh crore. Also, it would unleash employment opportunities for local youths on a large scale. A functionary of the HSIDC said that as per the term of agreement, RIL would have to provide 25 per cent of the jobs in the SEZ to local youths. Official circles have other reasons to be gung ho about the project. The state will have 10 per cent equity in the earnings from the project. This means that 10 per cent of the profits accruing from the various ventures in the SEZ will have to be given to the HSIDC. This dividend would come to the HSIDC kitty without it spending extra in the form of sweat or money. Also, RIL cannot sell the plots or shops in the SEZ to second party. It can only give it on lease. In the first phase the SEZ would be developed on about 8,000 acres of land. In effect, the first phase would have covered the areas in this district and approached the threshold of Jhajjhar district. The phasewise growth of the SEZ would allow scope for corrective measures, if any on the way of completion of the entire project. The local business community also has other reason to cheer. The SEZ will have top-notch companies setting up offices and manufacturing units for exports in it. These companies will be purchasing raw materials and other inputs from the local market. This would boost up the local market on all fronts. The general opinion is that if one Maruti Udyog in Gurgaon and Hero Honda in Rewari could change the profile of the two cities, the upcoming giant such as RIL is expected to leapfrog the development process in several ways. However, there are doubting Thomases and they would like to hedge their bets. According to them, there would be all-round development, provided the RIL completes the entire project. In case the industrial house only develops on about 1,700 acres of land given to it by HSIDC, it would be a great loss to the state.
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TAX tips Q. I want to complete the construction of my house for which I require funds. I am more than 65 years and may not be eligible to get bank loan. My wife, a government servant, has retired and got pension benefits. Can I get loan from her, or a relative, on nominal rate of interest/without interest and get IT exemption on the loan so raised. What formalities are required to be filled for the same? — P.J. Singh, Chandigarh A. It is possible for you to borrow the funds from your wife and other relatives. It would be better to pay normal rate of interest on such borrowings. The interest so paid would be allowed as deduction against the income from property. However, no deduction would be allowed for the amount of repayments towards such loan as Section 80C of the IT Act, 1961, (the Act) which provides for such deduction as it does not permit the deduction for repayments of loan received from wife/relatives. IT Act 54
Q. I am a Class III Punjab government employee. A plot was allotted to me by PUDA five year ago. This plot costs me Rs 9,40,000, including interest and registration charges. I sold this plot for Rs 15 lakh in 2005. Now, I have no any other property or house on my name. Do I have to pay any income tax? Can IT Act ‘54’ save me from paying IT? — Rakesh Uppal, Jalandhar A. The relevant particulars as to the date of acquisition of the plot are not indicated in the query. It is, therefore, not possible to compute the amount of capital gains and tax if any payable thereon. You can save capital gains tax in case you invest the gains in the acquisition or construction of a house within a specified period. In case you are not able to do so before the filing of the return, the same is required to be deposited in a bank or an institution under capital gains scheme and utilised in accordance with such scheme. Power of Attorney
Q. My son is an NRI and well-settled and married in Sweden. He has NRI a/c in India and I being his ‘mendator’ can make money transaction in his account by cheque as well as ATM card. Further, he has also given me “power of attorney” for cases of property dealing on his behalf on a stamp paper of Rs.500 duly sworn in before a Notary Public while he was in India. I purchased a residential plot on his name by withdrawing full amount for land from his bank from NRI a/c and made payment to the selling party by way of ‘cheque’ from his NRI a/c. When the deal was done he was not in India and as per the wish of my son and in order to stand for the purchaser for registry, that is, sale deed was prepared as 75 per cent ownership of my son and 25 per cent of my wife i.e. mother of my son. 1. Is it possible to sell the said property by my wife or me? 2. If yes, can the amount so realised be deposited to his NRE a/c from where the amount was earlier withdrawn. 3. Is there any type of tax obligations towards the money so received? 4. Are there any formalities of legal nature? How can the usage of General Power of Attorney be helpful or fruitful? — Tarsem Lall Sud, Amritsar A. The answers to your queries are: 1. You being the general power of attorney holder for your son, along with your wife, can sell the said property. 2. The amount so realised can be deposited in Non-Resident Ordinary Rupee (NRO) Account. 3. The sale of the plot would most likely involve the issue of capital gains. If the residential plot is held for a period of more than three years, the capital gain would be a long-term capital gain. Such gain would be computed after indexing the cost price of the residential plot and deducting the same from the sale price. The long-term gains so arrived at would be taxable @ 20 per cent plus applicable rate of surcharge and education cess. In case the plot was held for less than three years, the gain would be a short-term one. Such gains would be computed by deducting the cost price of the plot from the sale price of the plot. The gain so earned would be taxed at the normal tax rates. 4. The general power of attorney would be helpful at the time of registration of sale deed on behalf of your son. HUF property
Q. Recently I sold a piece of agricultural land relating to “Ancestral Property” outside the local limits of municipality and Cantonment board. I want to distribute the amount in equal form in share of gift to each member of my family that is my wife, two sons, two daughters-in-law and three grandsons (aged 4 to 14 years) My queries are: (a) Can I give any amount of gift, without limit, to each member of my family? (b) Will there be tax liability in the hands of recipients and myself and further will there be any tax on Capital Gain on sale above land against me? (c) Would the income on the gift, given by me to my three grandsons and invested by their parents in the name of children, be clubbed in hands of their parents or myself. (d) Up to what age of the child is the income clubbed in the hands of the parents. (e) I want to invest some amount in shares – purchase of equity. Therefore, I want to know at what amount of gross receipts is compulsory to maintain books of account u/s 44AA read with rules G-F. (f) Please clarify what gross receipts means. Whether sale or purchase or both in respect of equity – total transactions as receipts. — H. Dass, Ambala A. The answers to your queries are: 1. In accordance with the provisions of the Act as well as of the Hindu Succession Act 1956, the ancestral property referred to in your query should be deemed to be a HUF property and, therefore, any proceeds on the sale thereof shall retain the same character. The only way to severe relationship between the co-parceners is to partition the entire HUF property because a partial partition is not recognised by the Act. You would, therefore, be well advised to partition the entire HUF property in four shares in the first instance i.e. yourself, your wife and two sons. After such complete partition, each of you will have a right to gift or dispose of the funds in the manner in which he/she likes. 2. Any sale of property is likely to involve the issue of capital gains if the agricultural land is situated within the specified distance of the municipality and/or Cantt Board. The period of holding of the property in this case should be more than three years and the gain would be treated as a long-term one. The tax payable thereon is @ 20 per cent, plus applicable surcharge and education cess. The tax liability would be in the hands of the HUF. 3. The income earned on the amount gifted to the children would be clubbed in the hands of either of the parents till such time the children attain maturity. 4. As far as the purchase and sale of shares is concerned, if you are only intending to hold such shares as investments and do not intend to carry on the business of sale and purchase of shares, the provision of Section 44AA of the Act would not apply. Plot as gift
Q. A residential plot of 250 sq. yards was allotted by PUDA at Jalandhar in the name of my mother. Now she wants to gift the same to my wife on account of natural love (daughter in-law). Me and my wife (both) are Punjab Government employees. My query is would it attract tax liability as we are in the tax bracket of 30 per cent. If yes, how can it be avoided? — Swarn Singh, Jalandhar A. The gift of residential plot by your mother to your wife would not attract any income/gift tax liability. However, a proper gift deed would have to be executed and registered with the Sub-Registrar so as to convey the property to your wife. This will involve the expenditure on registration charges as well as the payment of stamp duty on the market value of the property as on the date of the gift.
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Buzz on Bourses
Mumbai: Hyderabad-based Prajay Engineers Syndicate Ltd, engaged in construction business, has announced plans to build an automobile mall in Hyderabad. The project, called Prajay Autopolis, will provide consumers the convenience of buying automobiles in a multi-brand retail space. The construction is expected to begin by the end of the year and the mall is expected to open in the second half of 2008. The company is in talks with several leading automobile companies to finalise space bookings in the autopolis.
— PTI
Raglan Group diversifies
Baddi: Raglan Group, a real estate player that plans malls and hotels in Himachal, has diversified into textiles. The Chandigarh-based company plans a unit with an investment of Rs 35 crore at Baddi. The group is also coming up with two prestigious projects in the hospitality segment.
— TNS
Ansals in Meerut
New Delhi: Ansal APL has announced to set up Sushant City in Meerut spread over 300 acres of land on the proposed express highway joining Delhi with Dehra Dun. A company press statement said, the complex would include amenities like school, crèche within and in the vicinity, playgrounds and parks, hospital, banks and a well-equipped gym apart from the shopping paradise at Ansal Plaza.
— TNS
Unitech to invest Rs 600 cr
New Delhi: Real estate company Unitech Ltd, which has also forayed into hospitality sector, plans to invest Rs 600 crore in next two years on its hotel business. “We are starting to build hotels. This fiscal we will have four of them — two at Gurgaon and one each in Noida and Kolkata. We will be investing Rs 600 crore for construction work,” Unitech Managing Director Sanjay Chandra said. On special economic zones, he said the government had cleared the Haryana SEZ, which would be constructed in 20,000 acres in two phases.
— PTI
Godrej keen on Bengal
Kolkata: The Godrej Group focussing on West Bengal in the real estate sector has lined up projects worth Rs 300 to Rs 400 crore in and around Kolkata. Three projects have been envisaged out of which one would be a mall. The interest was due to the reasonable land price in Kolkata. “We have undertaken three projects in Kolkata. Two IT parks and one mall are proposed in joint venture with CESC Ltd,” Manager (Corporate Development) Pirojsha Godrej told reporters.
— PTI |
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