Case Law Details
Rajkumari Gupta Vs ITO (ITAT Jaipur)
ITAT Jaipur held that provisions of section 50C of the Income Tax Act is not applicable because the immovable property was purchased/ sold as business property. Further, profit earned was duly reflected in the return of income. Accordingly, demand set aside.
Facts- During assessment proceedings, it was noticed that the assessee had sold an immoveable property for a consideration of Rs. 16,50,000/- which was valued at Rs. 20,97,780/- by the stamp valuation authority. AO was of the view that the assessee had not declared relevant capital gain. Therefore, after recording reasons and taking prior approval for opening of case u/s 147 from PCIT, notice u/s 148 was issued to the assessee. However, no return of income was filed in compliance to the notice u/s 148 within the stipulated time. Therefore, notices dated 31.05.2018 and dated 03.07.2018 were also issued requesting the assessee to file return of income in compliance to the notice issued u/s 148 dated 26.03.2018.
Since, no objection was filed by the assessee till 14.10.2018 therefore, assuming that the assessee has no objection on initiating proceedings u/s 147, the assessment proceedings were proceeded and notice u/s 143(2) and 142(1).
Considering the provisions of sec. 50C, the full value of consideration u/s 48 is to be considered at Rs. 20,97,780/-, No evidence in support of cost of acquisition/improvement have been filed by the assessee. However, on perusal of purchase/sale deed dated 30.09.2010, it is noticed that assessee had purchased the above property for Rs. 16,25,000/-. Therefore, the cost of acquisition is Rs. 16,25,000/-. The assessee has submitted that she had purchased the same as business assets for doing sale and purchase of business of property and it was not for investment purpose therefore provision of section 50C is not applicable.
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