Case Law Details
Case Name : ACIT Vs Shrikishan Dass (ITAT Delhi)
Appeal Number : ITA No. 915/Del/2012
Date of Judgement/Order : 07/06/2013
Related Assessment Year :
Assessee has sold/transferred a lease hold landed property at 36, SSGT road, Industrial area, Ghaziabad at a consideration of Rs.3,25,00,000/- to Sara exports Ltd. The said lease hold property was acquired by the assessee way back in 1971 as per the original elase deed dt. 26.8.71 for a consideration of Rs.12,20,500/- which included the cost of the land and building from UPSIDCO (UP State Industrial Development Corporation). The assessee has sold/transferred the lease hold property as per the agreement to sale dt. 27.8.2007 and the final lease deed dt. 29.10.2007. The elase hold property has been transferred which included the land of 10,216 sq.metres @ Rs.3,181/- per sq.metre at a total consideration of Rs.3,25,00,000/-. The lease hold property was acquired in 1971 for 90 years and the same has been transferred/sold in 2007 as per the final transfer lease deed dated 29.10.2007 for the remaining period of 54 years (90 years-36 years) i.e. 2007-1971. 3.2. The AO has taken the rate of the lease hold land @ Rs.4,500/- per sq.metre as per the rate of the UPSIDCO and accordingly has worked out the sale consideration of the land at Rs.4,59,73,395/- @Rs.4,500 x 10,216 sq.m.) by invoking provisions of s. 50c and taking the circle rate as noted by the AO in the order.
The undisputed fact is that there is no involvement or requirement of approaching the Stamp Duty Authority by the persons involved in the transaction as per law in this case. The lease in question has been granted by UP State Industrial Development Corp. Ltd. to the assessee vide lease agreement dated 29th day of October, 2007 for a period of 90 years. These lease hold rights were transferred to M/s. Sara Exports Ltd., Ghaziabad for a total consideration of Rs.3,25,00000/- only. Such transfer requires the approval of UPSIDCO. On these facts we have to see whether S.50 C applies. 8. In the case of Carlton Hotels (P) Ltd. Vs ACIT, 35 SOT 26(lucknow) ,122 TTJ 515, the Lucknow A bench of the ITAT held that “One of the relevant ingredients for invoking S.50 C is that there is a payment of stamp duty in respect of transfer of capital assets being land or building or both. The event which receipts adopting of valuation done by the Stamp Valuation Authority is the registration of a sale recording transfer of capital asset for which there is payment of stamp duty. Payment of stamp duty is required only when transfer of capital asset is registered under the Registration Act. If payment of stamp duty for the purpose of the transfer is not required, then there is no occasion to look into other conditions as mentioned in S.50 C . Therefore, in those cases of transfer where agreement or sale deed is not registered and stamp duty is not paid, or capital gain is simply charged by deeming certain transactions as transfer as per other provisions of the act or some transactions of transfer are not registered or are not legally required to be registered under the Registration Act, S.50’C’ cannot be put into operation.
In case of transfer of leasehold right is the capital gain applicable ?
If yes, is it to be computed by the difference of the lease- value only or the difference between previous value (lease/ market valueas fixed by stamp authority) and the present ( lease/ market) value ?
Thanks
ARUN