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Thursday, 12 Nov 2020
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Niranjan Hiranandani, President (National) NAREDCO and Assocham on exemption under Section 43CA, Income Tax Act

Hiranandani
 
“Differential above 10 percent between circle rates and agreement value translates into tax penalties under Section 43CA of the Income Tax Act. This has been a major stumbling block for price rationalization,” said Dr. Niranjan Hiranandani, President, NAREDCO and Assocham. “This pinches, especially when it comes to liquidating unsold inventory. Industry bodies like NAREDCO have been pointing out the urgency with which this needs to be sorted out, and the Hon’ble Finance Minister, in a limited-period offer (up to 30 June 2021), has enhanced this differential from 10 to 20 percent. This is welcome. The FM also mentioned a cap on the flat value to be eligible for this - Rs two crore. This will result in most projects in Metro Cities not being able to take advantage of this, it has consistently been pointed out by industry bodies that price points in Metro Cities need to be kept in mind while offering any such relaxation,” he pointed out. He went on to add that the ideal situation would have been one where this relaxation would be applicable to commercial real estate transactions as well. “Real estate as an industry and end-users, both would benefit if these two suggestions can be incorporated,” he concluded.  
 
“Funding issues have been a major challenge for real estate,” said Dr. Niranjan Hiranandani, President, NAREDCO and Assocham. “Finance Minister Nirmala Sitharaman’s announcement, about additional funding of Rs 18,000 crore for PM Awaas Yojana-Urban will add to the sparkle this festive season. This is over and above the Rs 8,000 already allotted this year, and will translate into more homes for home seekers, more employment opportunities as also good business for suppliers and industries peripheral to real estate and construction,” he concluded.

 

 
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