Case Law Details
Ashok Vadilal Patel Vs ITO (ITAT Ahmedabad)
The dispute between the assessee and the Revenue is, for the purpose of section 50C, which rate is to be deemed as full consideration for the sale of this property for purpose of section 48 of the Act ? According to the assessee, the rate should be adopted at Rs.200/- per sq.meter, which was settled between him and the vendee on the date of agreement i.e. 30.12.2010. On this day, even the stamp duty valuation authority has also fixed rate of Rs.140/-. Had the sale deed been executed on this date for the purpose of section 50C no other consideration could be deemed because the sale consideration disclosed by the assessee at the rate of Rs.200/- per sq.meter was far higher than Rs.140/- per sq.meter.
It is pertinent to observe that the assessee has entered into an agreement to sale on 30.12.2010. Had the assessee not executed the sale deed, then time limit for filing a suit for specific performance under the Specific Relief Act has been provided in the Limitation Act, and this limitation is three years from the date of the agreement.
In case vendee refused to get the sale deed registered, then the assessee can only sue for specific performance persuading the vendee to purchase land. In that circumstance, the assessee would not get anything more than the amount agreed in the agreement. Similarly, there can be a time gap between the date of agreement vis-à-vis ultimate registration of sale deed. There can be an appreciation or depreciation in the value of the property.
In other words, at the time of execution of agreement in respect of an immovable property, the right in persona is created in favour of the transferee/vendee. When such right is created in favour of the vendee, the vendor is restrained from selling the said property to someone-else, because vendee in whose favour the right in persona is created has legitimate right to enforce specific performance of the agreement, if vendor for some reason is not executing the sale deed.
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