The Mumbai Income Tax Appellate Tribunal has ruled that Joint owners of properties by mere name cannot be held liable for Tax liabilities if the purchase of the property was not financed by him/her. Many people/couples purchase flats/properties in Joint names for convenience and security sake, but the money is paid entirely by one of the parties.
The order was given in the case of a Medical Professional named Vandana Bulchandani.
An Income tax officer had determined that Bulchandani had not disclosed Capital Gains via sale of property in Parel, Mumbai, worth 2.12 crores, which she jointly owned with her husband in the year 2008-2009. But Bulchandani claimed that the property purchase was financed entirely via money from her husbands account and that he had offset the capital gains against the loss in share trading.
As per IT rules, short term capital gains can be offset against loss from share sales in the same financial year.
The case was referred to the Tribunal and it ruled in favor of Bulchandani and her husband.
