New Tax Rules for Joint Development: Capital Gains Charged on Project Completion Certificate Issuance Under Section 45(5A)

Section 45(5A) of the Income Tax Act outlines the computation of capital gains for individuals or Hindu Undivided Families (HUF) involved in joint development agreements. Capital gains from transferring land or buildings under such agreements are chargeable in the year when the project completion certificate is issued by the competent authority. The full value of consideration includes the stamp duty value of the share on the certificate's issuance date plus any cash consideration. These provisions do not apply if the share is transferred before the completion certificate is issued. Section 49(7) specifies the cost of acquisition as the amount deemed as full value of consideration.