Opinion Of Eminent Legal Luminaries On Controversial Issues

Capital gains – Full value of consideration – Stamp valuation – Stamp value is more than Fair value – S. 50C(3)

QUERY: The vacant plot was purchased five years back, which is sold at Rs. 60,00,000/-, but Stamp Duty value is Rs. 1,30,00,000/- what assessee should do?
ANSWER: Section 50C provides that where consideration received or accruing as a result of the transfer of land or building or both, is less than the value adopted or assessed by any authority of a State Government for the purpose of stamp duty in respect of such transfer, the value so adopted or assessed shall be deemed to be the full value of the consideration, and the capital gains shall be computed accordingly under section 48 of the Act.
It further provides that where the assessee claims that the value adopted or assessed for stamp duty purposes exceeds the fair value of the property as on the date of transfer, he may dispute the value so adopted or assessed in any appeal or revision or reference before any authority or court. If he has not disputed before any authority or court, he may request the Assessing Officer to refer the matter to a Valuation Officer in accordance with section 55A of the Act.
If fair value determined by the Valuation Officer is less than the value adopted for Stamp Duty purposes, the Assessing Officer may take such fair market value to be the full value of consideration. However, if the fair market value determined by the Valuation Officer is more than the value adopted or assessed for the Stamp Duty purposes, the Assessing Officer shall not adopt such fair market value and shall take the full value of consideration to be value adopted or assessed for Stamp Duty purposes.

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