From the sale of my previous flat, I bought 2 adjoining flats in a building with the intention of making it into 1 bigger flat - the interconnecting wall was also broken down for this purpose. Two years after filing returns and paying the appropriate capital gains tax, the Income Tax dept. insists I can gain tax exemption for only 1 flat, not 2, even though both are in my name and re being used as 1 house. They even came home to inspect the house but are still insisting it is considered 2 flats, not one and are demanding I pay the remaining tax now.
Has anyone else faced this problem and what did you do?