FMV as on Date of Sale Agreement is Relevant for Section 50C

Ms. Balmer Lawrie Van Leer Ltd. Vs ACIT (ITAT Mumbai)

Conclusion-  Provision of section 50C is applicable as on the date of execution of sale agreement and accordingly the fair market value of the property as on the date of sale agreement is to be taken.

FACTS –

In August, 2007, the assessee entered into a sale agreement for sale of its factory line and business. Assessee received around 50% of the consideration at the time of sale agreement, however, the sale deed was registered on April, 2009.

Assessee paid INR 1.92 Crore to M/s. Balmer for agreeing to surrender its leasehold rights which was granted by the assessee.

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