implication of income tax for refund of flat booking amt with interest

I had given booking amount to a builder for a flat in Mumbai. Even after 1.5 years he had not started the construction, i asked him for refund of my booking amount. The Builder gave me my principal amount + interest of Rs. 162,000/-. I want to know the tax implication for this interest amount. If I invest this interest amount in a NA plot in my native place will i get tax exemption for the same. Regards,

asked Feb 24 '12 at 16:59 by amj 111

The interest amount would be taxable similar to bank interest. This would be added to your taxable yearly income and would be taxed as per slab rates.

As this is not long term capital gains, no income tax exemption would be available.

answered Feb 25 '12 at 15:51 by Pankaj Batra 5.2k320


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Asked: Feb 24 '12 at 16:59

Seen: 2,036 times

Last updated: Feb 25 '12 at 15:51