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Vivek Lala  |251 Answers  |Ask -

Tax, MF Expert - Answered on Apr 01, 2024

Vivek Lala has been working as a tax planner since 2018. His expertise lies in making personalised tax budgets and tax forecasts for individuals. As a tax advisor, he takes pride in simplifying tax complications for his clients using simple, easy-to-understand language.
Lala cleared his chartered accountancy exam in 2018 and completed his articleship with Chaturvedi and Shah. ... more
Asked by Anonymous - Mar 30, 2024Hindi

How to get 2001 guideline value of my flat in Mumbai ?

Ans: Hello, you can get a valuation report for the same from a registered valuer
DISCLAIMER: The content of this post by the expert is the personal view of the rediffGURU. Users are advised to pursue the information provided by the rediffGURU only as a source of information to be as a point of reference and to rely on their own judgement when making a decision.

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Ramalingam Kalirajan  |4605 Answers  |Ask -

Mutual Funds, Financial Planning Expert - Answered on Jun 06, 2024

My father bought a property ,about two acres ,within municipal limit in the ear 1959: for rupees five hundred only. The legal heirs are seven. Now the property guide line value is around 800 rupees per square foot for sale registration. More than fifty percent has been occupied by others. The remaining half is in my possession. Local consultants say the purchase price for tax purposes will be the guideline value of the year 2000 and not ?500 . Is it true. Kindly advise.
Ans: Understanding Property Valuation and Tax Implications
Dealing with property inherited from a parent can be complex, especially regarding its valuation and tax implications. I understand your concerns about the property bought by your father in 1959 and its current value for tax purposes. Let's break down the factors involved and clarify the best approach for you and your legal heirs.

Historical Purchase Price vs. Guideline Value
Your father's property was bought for Rs 500 in 1959. However, for tax purposes, especially capital gains tax, the purchase price might be adjusted based on guidelines from the Income Tax Department.

Guideline Value Adjustment:

The purchase price can be recalculated using the guideline value as of a certain base year, which simplifies tax calculations.
Base Year for Property Valuation
Understanding the Base Year Concept:

For properties acquired before 1st April 2001, the base year for calculating capital gains tax is 1st April 2001.

This means you can consider the fair market value of the property as of 1st April 2001 instead of the original purchase price in 1959.

Calculating Fair Market Value as of 1st April 2001
Local Consultant’s Advice:

The consultants suggested using the guideline value of the year 2000, which is correct for determining the property's fair market value as of the base year.
Steps to Calculate:

Determine the guideline value per square foot in 2001 for the property location.

Multiply this value by the property area (in square feet) to get the adjusted purchase price for tax purposes.

Example Calculation

Guideline value in 2001: Rs 200 per square foot

Property area: 2 acres = 87,120 square feet


Adjusted purchase price = 87,120 sq ft * Rs 200/sq ft = Rs 1,74,24,000
This adjusted purchase price will be used to calculate capital gains when you sell the property.

Capital Gains Tax Calculation
Types of Capital Gains:

Long-Term Capital Gains (LTCG): Property held for more than 24 months.
Tax Implications:

For LTCG, you need to subtract the indexed cost of acquisition from the sale value.
Indexation Benefit
Indexation Adjusts Purchase Price:

Indexation accounts for inflation, allowing you to adjust the purchase price to current terms.
Example Indexation Calculation:

Indexed cost of acquisition = Adjusted purchase price * (Cost Inflation Index (CII) for the year of sale / CII for the year 2001)

Sale year: 2024

CII for 2024: 348

CII for 2001: 100


Indexed cost = Rs 1,74,24,000 * (348/100) = Rs 6,05,43,520
Calculating Capital Gains
Sale Price:

Assume the property sells for Rs 800 per square foot.

Sale value = 87,120 sq ft * Rs 800/sq ft = Rs 6,96,96,000

Capital Gains:

Capital gains = Sale value - Indexed cost

= Rs 6,96,96,000 - Rs 6,05,43,520 = Rs 91,52,480

Tax Payable:

LTCG tax rate is 20%.

Tax = 20% of Rs 91,52,480 = Rs 18,30,496

Steps to Handle the Property
1. Regularization of Possession:

Work on legal regularization of the occupied part to avoid future disputes.
2. Divide Among Heirs:

Divide the property legally among the seven heirs for clarity and ease of sale.
3. Consult Professionals:

Engage a certified financial planner (CFP) for personalized advice.
Important Considerations
Legal Documentation:

Ensure all property documents are updated and legal heirs are recognized.
Market Conditions:

Analyze current market conditions to decide the best time to sell.
Investment of Sale Proceeds:

Plan for reinvestment of sale proceeds to minimize tax and maximize returns.
Professional Guidance
Certified Financial Planner (CFP):

A CFP can help navigate legal, tax, and investment complexities.
Tailored Advice:

Get advice tailored to your family’s financial goals and circumstances.
Using the guideline value of the year 2000 for tax purposes is correct and beneficial. Ensure proper legal documentation and seek professional advice for the best outcomes. This will help in managing the property sale efficiently and optimizing your financial benefits.

Best Regards,

K. Ramalingam, MBA, CFP

Chief Financial Planner,


..Read more


Ramalingam Kalirajan  |4605 Answers  |Ask -

Mutual Funds, Financial Planning Expert - Answered on Jun 20, 2024

I have a flat in mumbai which is used by my cousin for 40 years, how can I get it back
Ans: It’s challenging when a property situation like this arises, especially with family involved. Let's go through the steps to reclaim your flat in Mumbai from your cousin.

Understanding Your Situation
First, let's break down the situation:

Flat in Mumbai: Owned by you.
Occupied by Cousin: For 40 years.
Legal Perspective
Reclaiming your flat involves legal processes. Here are the steps you need to follow:

Property Documents
Ensure all property documents are in your name. You need:

Sale Deed: Confirms ownership.
Property Tax Receipts: Paid in your name.
Electricity Bills: Preferably in your name.
Mutation Certificate: From municipal records.
These documents prove your ownership and are essential for legal proceedings.

Communication with Cousin
Start with a polite but firm conversation. Explain your need for the flat. Family issues can often be resolved without legal action. If your cousin is reasonable, they might agree to vacate amicably.

Legal Notice
If discussions don't work, send a legal notice through a lawyer. This notice should:

State Your Ownership: Clearly mention you own the property.
Request Vacation: Ask your cousin to vacate within a specific period.
Mention Legal Action: Indicate that you will take legal action if they do not comply.
Eviction Suit
If the legal notice is ignored, you need to file an eviction suit. Here’s how:

Hire a Lawyer: Choose a lawyer experienced in property disputes.
File a Suit: The lawyer will draft and file an eviction suit in the appropriate court.
Court Proceedings: Attend court hearings. Present all your property documents and evidence.
Court Order: If the court rules in your favor, your cousin will be legally required to vacate.
Police Assistance
If your cousin refuses to comply with the court order, seek police assistance. Provide them with:

Court Order: Showing the ruling in your favor.
Property Documents: Proving your ownership.
The police can help enforce the court order.

Alternative Solutions
Consider other solutions to avoid lengthy legal battles:

Monetary Settlement: Offer a financial incentive for your cousin to vacate.
Alternative Accommodation: Help them find another place to stay.
Maintaining Family Relations
Legal battles can strain family relationships. Try mediation or family counseling to resolve disputes amicably. Involve neutral family members to mediate.

Reclaiming your flat in Mumbai from your cousin involves a mix of legal steps and family negotiations. Start with communication, followed by legal notice and, if necessary, an eviction suit. Keep all your property documents ready and consider alternative solutions to maintain family harmony.

Best Regards,

K. Ramalingam, MBA, CFP

Chief Financial Planner


..Read more

Latest Questions

Maxim Emmanuel  |288 Answers  |Ask -

Soft Skills Trainer - Answered on Jul 12, 2024

Asked by Anonymous - Apr 23, 2024Hindi
Hello sir my name is Santu Chakraborty.I am 34 year old now unmarried. My qualification is Bsc botany honours with 2nd class +diploma in mechanical engineering with distinction +btech in mechanical engineering from government engineering college west Bengal with 7.5 dgpa.I have 6 years of teaching experience in private diploma engineering college and now I working as a vocational teacher in automobile engineering department in gov high school.In my early phase of life I am going through lots of Misguide,seveare Anxiety issue. Nobody can help me on that phase.I recover mostly by my own after various dillema.I want to work in mechanical r and d company, Mechanical design basis company and also upgrade my teaching carrier. How can I start my journey at this age ?what is the risk factor also? Please tell me. I am very enthusiastic dedicated person. I have no guide in my home. My father is vegetable seller.
Ans: Hi Santu Chakraborty,

This is a really exhaustive query.

The journey thru' your acquisition of qualifications has been vast!

In the course of your life you are now suffering from SNIOP (SUSCEPTIBLE NEGATIVE INFLUENCE OTHER PEOPLE) this happens when you let others control your life.

I have this poem.. Especially for one's like you!

The Guy in the Glass

When you get what you want in your struggle for pelf,
And the world makes you King for a day,
Then go to the mirror and look at yourself,
And see what that guy has to say.
For it isn't your Father, or Mother, or Wife,
Who judgement upon you must pass.
The feller whose verdict counts most in your life
Is the guy staring back from the glass.
He's the feller to please, never mind all the rest,
For he's with you clear up to the end,
And you've passed your most dangerous, difficult test
If the guy in the glass is your friend.
You may be like Jack Horner and "chisel" a plum,
And think you're a wonderful guy,
But the man in the glass says you're only a bum
If you can't look him straight in the eye.
You can fool the whole world down the pathway of years,
And get pats on the back as you pass,
But your final reward will be heartaches and tears
If you've cheated the guy in the glass.

Dale Wimbrow (c) 1934

Get the enthusiasm going, don't get embroiled in what life has been before!

Take a stranglehold of your life and make it BIG!

The opportunities are.. Miracles waiting to happen, what are you waiting for.. You are the catalyst!?
Maxim Emmanuel.

Pick up yourself don't be a victim of self pity.

If you do need further professional advice happy to assist

...Read more

Nayagam P

Nayagam P P  |1830 Answers  |Ask -

Career Counsellor - Answered on Jul 12, 2024

DISCLAIMER: The content of this post by the expert is the personal view of the rediffGURU. Investment in securities market are subject to market risks. Read all the related document carefully before investing. The securities quoted are for illustration only and are not recommendatory. Users are advised to pursue the information provided by the rediffGURU only as a source of information and as a point of reference and to rely on their own judgement when making a decision. RediffGURUS is an intermediary as per India's Information Technology Act.


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