Opinion Of Eminent Legal Luminaries On Controversial Issues

What Step Assessee Should Take, If Stamp Duty Valuation Is Not Acceptable?

QUERY: X purchased a vacant site (2400 sft) of rural area of Andhra Pradesh for Rs. 10,000/- in the financial year 1995-96 and paid Stamp Duty as per above consideration. Now X wants to sell it to Y for Rs. 2,00,000/- i.e. actual consideration. But Stamp Duty has to pay for Rs. 16,00,000 i.e. reckoner value of Rs. 16,00,000/-. What steps X and Y should take?
ANSWER: Section 50C(1) if the Act provides that in case where the value adopted or assessed by the stamp valuation authority in respect of a transfer of land or building or both for the purpose of payment of stamp duty exceeds the consideration received or accrued by the assessee for such transfer, the value so adopted or assessed shall be deemed to be the full value of the consideration received or accruing for such transfer.

Section 50C(2), provides for the valuation of the capital asset to be referred to a valuation officer where the assessee claims that the value adopted by the stamp authority is in excess of the fair market value of the property. The valuation of the capital asset cannot, however, be referred to a valuation officer where the value adopted or assessed by the stamp authority has been disputed in appeal or revision or in reference before any authority, Court or the High Court.

So, in this case, Y has to challenge the value adopted or assessed by the stamp authority in appeal or revision or in reference before any authority, Court or High Court.

If Y does not dispute the said valuation before any authority or Court or High Court then, X can claim before the Assessing Officer that the value so adopted or assessable by stamp duty authority is in excess of fair market value of the property as on date of transfer, be referred to the valuation officer.
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Credit: Several of the queries and answers are reproduced with permission from the AIFTP Journal. We thank AIFTP for generously allowing us to host their research material.
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