He gave land given for road, sold TDRs for Rs 6.02 crore; ITAT taxes capital gains
A landowner in Bengaluru is facing a capital gains tax dispute after selling Transferable Development Rights (TDRs) received from the government. The Income Tax Department argues the proceeds are taxable, while the landowner contends they are non-taxable capital receipts.
Why it matters
This case highlights the complex tax implications of government-issued development rights, which are increasingly common in urban infrastructure projects.
You get Transferable Development Rights from the government by giving up a part of your land and sell them to a builder. Are you liable to pay capital gains tax?In one such case a landowner received Transferable Development Rights (TDRs) but assumed them to be capital receipts. The Income Tax Department sent him a notice.What the case is aboutWhen the Bruhat Bengaluru Mahanagara Palike (BBMP) approached the landowner to acquire a portion of his property for road widening, he agreed to surrender the land.
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