Income tax for exchange of land

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1

Let me explain the situation through an example. Two people ( A and B) want to exchange their land(same state, different cities, non agricultural) through exchange deed without any monetary consideration. Both of them have held their land for more than 10 years.

Before exchange of land :

Land of A :
the indexed cost of acquisition is 1 lac
the stamp duty value of land is 8 lac

land of B:
the indexed cost of acquisition is 2 lac
the stamp duty value of land is 10 lac

After exchage, what will be the income tax implication for both A and B ?

2

Hi @dipu1

Even though there is no monetary consideration, there will still be income tax implications in the form of capital gains.

Capital Gains = Stamp Duty Value - Indexed Cost of Acquisition of Land.

Person A would be liable to pay income tax on the capital gains of₹ 7 lakhs and person B on ₹8 lakhs, from the exchange of land.