CONVERSION OF CAPITAL ASSET INTO STOCK

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....ONVERSION OF CAPITAL ASSET INTO STOCK<br> Query (Issue) Started By: - SARVESH BALDI Dated:- 9-1-2013 Last Reply Date:- 21-3-2015 Income Tax<br>Got 1 Reply<br>Income Tax<br>SIR AN INDIVIDUAL ENGAGED ....

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....IN REAL ESTATE BUSINESS PURCHASED A LAND AS AN INVESTMENT IN THE MID OF YEAR SAY SEPT. LAND WAS PURCHASED IN CASH.HOWEVER, ON CLOSURE OF ACCOUNTS HE REVIEWED AND CONVERTED CAPITAL ASSET PURCHASED INTO....

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.... STOCK. CASH WAS WITHDRAWN FROM BANK ON DATE OF PURCHASE OF LAND ADN INTENTION WAS INVESTMENT. NOW CAN AO DISALLOW SUCH PURCHASES ON HOLDING THAT IT WAS BUSINESS ASSET AND PURCHASE IN CASH WAS DISAL....

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....LOWABLE?? PLZ GUIDE Reply By Rama Krishana: The Reply: In tax laws it is well established that Substance is more relevant over form. As long as it is on record you have purchased the Land as capit....

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....al asset, the event of conversion the same as Stock in trade later would not entitle the AO to disallow the same as Cash Purchase exceeding &#8377; 20,000.<br> Discussion Forum - Knowledge Sharing ....