Case Law Details
Kishore Hira Bhandari Vs ITO (ITAT Mumbai)
ITAT Mumbai held that amendment to section 50C of the Income Tax Act stating that the value adopted or assessed or assessable by the stamp valuation authority on the date of ‘agreement’ may be taken for the purpose of computing the full value of consideration for such transfer is retrospective in nature and effective from 1st April 2003.
Facts- AO observed that the assessee had sold urban agricultural land vide a ‘sale deed’, dated 28.06.2013 for a consideration of Rs.1,65,00,000/-. On the basis of an unsubstantiated claim, it was submitted by the assessee that the aforesaid agricultural land was co-owned by 5 persons in equal share. The assessee despite specific directions by the A.O failed to place on record the copy of the purchase deed on the pretext that the same was an ancestral property.
Further, on a perusal of the ‘sale deed’ it was noticed by the A.O that the assessee was in receipt of an amount of Rs.1,09,00,000/- (out of the total sale proceeds of Rs.1,65,00,000/-) on the sale of the aforesaid property.
AO observed that the reserve price of the property as per the stamp valuation authority as was discernible from the ‘sale deed’ was Rs.5,81,79,500/-. Accordingly, the A.O called upon the assessee to explain as to why the capital gain on the sale of the aforementioned property may not be worked out as per Sec.50C of the I.T Act. As the assessee failed to put forth any explanation, therefore, the A.O worked out LTCG in the hands of the assessee as per Sec. 50C of the I-T Act. Further, as the assessee did not place on record the copy of the purchase deed, therefore, the A.O worked out the share of the LTCG in the hands of the assessee at 66.06% of the deemed sale consideration under Sec. 50C of Rs. 5,81,79,500/-. Accordingly, the A.O worked out the LTCG in the hands of the assessee at Rs.3,84,33,378/- (i.e 66.06% of Rs. 5,81,79,500/-) and assessed his income at Rs. 3,87,01,120/-.
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