Real Estate Valuation
Land, buildings and projects — residential, commercial, industrial and redevelopment — for lenders, courts and tax.
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Capital Gains & FMV as on 1 April 2001
Fair market value as on 1 April 2001 and cost-of-construction reports for capital gains — prepared by valuers registered with the Income Tax Department.
Overview
Fair market value as on 1 April 2001
When you sell land, a building or a flat, capital gains are worked out as the sale value less the cost of acquisition and improvement. For property acquired before 1 April 2001, the Income-tax law allows its fair market value on that date to be used in place of the original cost — which for older property is often far higher than the price paid decades ago.
For land and buildings, the fair market value used cannot exceed the stamp duty value on 1 April 2001. Where the property was inherited or gifted, the date on which the previous owner acquired it is what matters.
A registered valuer's report supports the value with evidence from 2001 — comparable transactions of that period, the Government ready reckoner of that year, and the property's location, size and condition — so that it can be relied on if the computation is examined.
Purposes
When you need this report
Sale of older property
Property bought before 1 April 2001, where the 2001 value replaces the original cost.
Sale of older property
- Fair market value as on 1 April 2001 in place of cost
- Capped at the 2001 stamp duty value for land and buildings
- Cost of later improvements, where claimed
- Report for your tax adviser's computation
Inherited or gifted property
Property received from a family member who acquired it before 2001.
Inherited or gifted property
- Previous owner's acquisition date decides eligibility
- Inheritance or gift documents to trace the chain
- Fair market value as on 1 April 2001
- Same stamp duty value cap for land and buildings
Cost of construction
Cost of construction or improvement of a house, for capital gains or other tax purposes.
Cost of construction
- Cost of building or improvement in the year it was done
- Based on construction type, area and specifications
- Supported by an inspection of the structure
- For capital gains and other tax purposes
Stamp duty value differences
Independent valuation where the sale price is below the stamp duty value and the difference is questioned.
Stamp duty value differences
- Fair market value on the date of transfer
- Comparable sales and the property's actual condition
- Factors the ready reckoner rate does not reflect
- Support for your tax adviser in proceedings
Redevelopment
Society redevelopment and joint development, where old flats or land are exchanged for new ones.
Redevelopment
- Value of the old flat or land given up
- Fair market value as on 1 April 2001 where it applies
- Development rights and the new area received
- Reports for the society or individual members
NRI property sales
Supporting the capital gains computation when a non-resident sells property in India.
NRI property sales
- Fair market value as on 1 April 2001 for older property
- Cost of construction or improvement, where claimed
- Report for your tax adviser in India
- Inspection with your representative present
Scope
Property we value
- Flats and apartments
- Bungalows and independent houses
- Open plots and land
- Shops and commercial premises
- Industrial land and buildings
- Old tenanted and cessed buildings
- Development rights in redevelopment
Checklist
Documents generally required
- Purchase deed or agreement (from before 2001), or the inheritance / gift documents
- Property card or 7/12 extract
- Approved plan and occupancy certificate, if available
- Society share certificate for flats
- Current sale agreement, if the property has been sold
Methodology
How the 2001 value is established
- 01
Market evidence of 2001
Registered sale instances and market rates for comparable property in the same locality around April 2001.
Market evidence of 2001
- Registered sale instances from around April 2001
- Same locality and comparable property type
- Adjusted for size, floor, frontage and condition
- Lower value applies where the evidence shows it
- 02
Ready reckoner of 2001
The Government's stamp duty rate for the property in 2001 — the upper limit for land and buildings.
Ready reckoner of 2001
- Stamp duty rate for the zone and property type
- Applied to the property as it stood in 2001
- Sets the upper limit for land and buildings
- Compared with the market evidence of 2001
- 03
Land plus building
Land value plus the depreciated cost of the building as it stood in 2001, where comparable sales are thin.
Land plus building
- Land rate from 2001 market evidence
- Building cost by construction type at 2001 rates
- Depreciation for the building's age at that date
- Used where comparable sales are thin
Our process
How it works
Step 01
Documents
Share your purchase or inheritance documents and the property details; we confirm what else is needed.
Step 02
Inspection
We inspect the property to record its location, size, construction and condition.
Step 03
2001 evidence
We research the 2001 ready reckoner rate and market transactions of that period.
Step 04
Valuation
We determine the fair market value as on 1 April 2001, capped at the stamp duty value where it applies.
Step 05
Report
A signed report by a valuer registered with the Income Tax Department, ready for your tax adviser.
Who does the work
Our team for this service
Our valuers registered with the Income Tax Department for land and buildings.
Sharadkumar B. Chalikwar
Chairman & Managing Director
IBBI — Land & BuildingIncome Tax — Land & Building, Plant & MachineryIOV — Land & BuildingIIV — Plant & MachineryPVAI — Land & BuildingChartered Engineer (India) — The Institution of Engineers (India)Fellow — The Institution of Engineers (India)
Manoj B. Chalikwar
Joint Managing Director
IBBI — Land & Building, Plant & MachineryIncome Tax — Land & Building, Plant & MachineryIIV — Land & Building, Plant & MachineryPVAI — Land & BuildingIIV-RVF — Plant & MachineryChartered Engineer (India) — The Institution of Engineers (India)Licensed Structural Engineer — Maharashtra (UDCPR) — Directorate of Town Planning, Government of MaharashtraMember — The Institution of Engineers (India)
Vidhi M. Chalikwar
Director
Income Tax — Land & BuildingIIV — Land & BuildingIIV-RVF
Umang A. Patel
Director
IBBI — Land & Building, Plant & MachineryIncome Tax — Land & Building, Plant & MachineryIIV — Land & Building, Plant & MachineryIIV-RVF — Land & Building, Plant & MachineryChartered Engineer (India) — The Institution of Engineers (India)Associate Member — The Institution of Engineers (India)
Shashikant B. Chalikwar
Executive Director
Income Tax — Land & BuildingIIV — Land & BuildingIIV-RVF — Land & BuildingChartered Engineer (India) — The Institution of Engineers (India)Member — The Institution of Engineers (India)
FAQ
Frequently asked questions
Can't find the answer? Ask us directly — we're happy to explain how an assignment would work.
All questionsCan the 2001 ready reckoner rate alone be used as the fair market value?
It sets the upper limit for land and buildings, but the fair market value itself should be supported by market evidence from 2001. Where market evidence gives a lower value, the lower value applies.
Which properties qualify for the 1 April 2001 value?
Property acquired before 1 April 2001 — including property you inherited or received as a gift, if the previous owner acquired it before that date.
Who can issue the report?
A registered valuer. Our valuers for land and buildings are registered with the Income Tax Department; their registration numbers are listed on our credentials page.
Do you need to visit the property?
Yes. An inspection is needed to record the property's location, size and condition, even though the valuation date is in 2001.
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