section 50C

Certain instances of tax planning in case of sale of house property

Income Tax - The last 4-5 years have not been the best period for the real estate industry in India. Many real estate companies have become bankrupt and many still continue to be under great financial stress due to stalled projects. Even a normal home buyer is not in a profitable position due to declining property rates. The […]...

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Time to Revisit Section 50C/43CA/56(2) – Adoption of Circle Rates

Income Tax - Time to Revisit Section 50C/43CA/56(2) of Income Tax Act concerning Adoption of Circle Rates for Computation of Capital Gain/Business Profits/Income from Other Sources on Land & Building!! The Finance Act 2002 has introduced a new section 50C with effect from 1-4-2003, for the purpose of computation of capital gains in real estate tra...

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Pre-Budget Memorandum 2019- A Small Wish List From New Finance Minister

Income Tax - Union Budget 2019 – New Finance Minister Smt. Nirmala Sitharaman’s first budget after the huge and unprecedented electoral win of Sh. Narendra Modi Government has the backing of a mammoth public mandate and as such is expected to be a reform oriented budget and not a populist one. However, along with the bold and reform […]...

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Deeming Fiction for Real Estate: Is It beyond Reality?

Income Tax - One of the most controversial provisions, which had a huge impact on the taxation of Real Estate Transactions, was the introduction of concept of Deeming Fiction through Section 50C....

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Analysis of S. 50C of Income Tax Act, 1961

Income Tax - Section 50C provides that if the value stated in the instrument of transfer is less than the valuation adopted, assessed or assessable by the stamp duty authorities, the valuation as adopted, assessed or assessable by the stamp duty authorities will be considered for the purpose of computation of capital gains arising on transfer of lan...

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6 Suggestions for Amendments in Income Tax Act by BCAS

Income Tax - Bombay Chartered Accountants' Society has made a Representation on 'Suggestions for Amendments in the Income Tax Act', on 24th May, 2019, to the Joint Secretary TPL, Central Board of Direct Taxes, Ministry of Finance, Government of India....

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Section 50C: Option for adopting stamp duty value on date of agreement- ICAI Suggestion

Income Tax - In relation to computing capital gains tax liability on transfer of land or building, amendment made via the Finance Act, 2016 gives an option for considering the stamp duty value as on date of agreement instead of stamp duty value on date of registration...

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Provide relief when agreement date fixing sale consideration & Registration Date not same

Income Tax - Rationalisation Of Section 50c To Provide Relief Where Sale Consideration Fixed Under Agreement To Sell- Section 50C makes a special provision for determining the full value of consideration in cases of transfer of immovable property. It provides that where the consideration declared to be received or accruing as a result of the transfer...

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Brokerage paid by purchaser cannot be taken into account for Section 50C

ITO Vs Smt. Rajani Manhar Bhagat (ITAT Ahmedabad) - Since the market value of immovable property sold by assessee had to be Rs.2,60,05,348/- and the purchase consideration together with costs towards obtaining vacant property should stand at Rs.2,26,00,000/-, therefore, the long term capital gain would be Rs.34,05,348/- as per section 50C and the bro...

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Assessee entitled to challenge correctness of DVO’s valuation before CIT(A)

Lovy Ranka Vs DCIT (ITAT Ahmedabad) - Section 50C is a deeming provision and Assessing Officer is obliged to compute capital gains by taking valuation arrived at by DVO in place of the actual consideration received by assessee,  assessee is entitled to challenge correctness of DVO's valuation before CIT(A) and ITAT. DVO has to be given...

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S. 50C Addition without reference to Valuation Officer not justified

Jayashree Kothari Vs ITO (ITAT Hyderabad) - Jayashree Kothari Vs ITO (ITAT Hyderabad) Sec. 50C(2) enables the Assessing Officer to make a reference to the Valuation Officer. Whenever a reference is made by the AO to the Valuation Officer, such reference has to be construed as a reference made under sec. 16A(1) of the Wealth-tax Act. We have a...

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FMV of capital asset can be determined only after hearing objections of assessee

Ms. Jagannathan Sailaja Chitta Vs ITO (Madras High Court) - Since a bare reading of scheme of Section 50C would show that assessee could object to presumptive value as per Section 50C (1) and, therefore, it was only after hearing the objections of assessee, the fair market value of capital asset as per 'Guidance Value' could be determined by authorities, the...

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Section 50C cannot be avoided merely for sufficiency of exemption u/s 54EC

Jagdish C. Dhabalia Vs ITO (Bombay High Court) - While giving full effect to the deeming fiction contained under section 50C of the Act for the purpose of computation of the capital gain under section 48, for which section 50C is specifically enacted, the automatic fallout thereof would be that the computation of the assessee’s capital gain and ...

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Recent Posts in "section 50C"

Certain instances of tax planning in case of sale of house property

The last 4-5 years have not been the best period for the real estate industry in India. Many real estate companies have become bankrupt and many still continue to be under great financial stress due to stalled projects. Even a normal home buyer is not in a profitable position due to declining property rates. The […]...

Read More
Posted Under: Income Tax |

Time to Revisit Section 50C/43CA/56(2) – Adoption of Circle Rates

Time to Revisit Section 50C/43CA/56(2) of Income Tax Act concerning Adoption of Circle Rates for Computation of Capital Gain/Business Profits/Income from Other Sources on Land & Building!! The Finance Act 2002 has introduced a new section 50C with effect from 1-4-2003, for the purpose of computation of capital gains in real estate tra...

Read More
Posted Under: Income Tax |

Brokerage paid by purchaser cannot be taken into account for Section 50C

ITO Vs Smt. Rajani Manhar Bhagat (ITAT Ahmedabad)

Since the market value of immovable property sold by assessee had to be Rs.2,60,05,348/- and the purchase consideration together with costs towards obtaining vacant property should stand at Rs.2,26,00,000/-, therefore, the long term capital gain would be Rs.34,05,348/- as per section 50C and the brokerage costs incurred on sale considerat...

Read More

Pre-Budget Memorandum 2019- A Small Wish List From New Finance Minister

Union Budget 2019 – New Finance Minister Smt. Nirmala Sitharaman’s first budget after the huge and unprecedented electoral win of Sh. Narendra Modi Government has the backing of a mammoth public mandate and as such is expected to be a reform oriented budget and not a populist one. However, along with the bold and reform […]...

Read More
Posted Under: Income Tax |

6 Suggestions for Amendments in Income Tax Act by BCAS

Bombay Chartered Accountants' Society has made a Representation on 'Suggestions for Amendments in the Income Tax Act', on 24th May, 2019, to the Joint Secretary TPL, Central Board of Direct Taxes, Ministry of Finance, Government of India....

Read More
Posted Under: Income Tax |

Assessee entitled to challenge correctness of DVO’s valuation before CIT(A)

Lovy Ranka Vs DCIT (ITAT Ahmedabad)

Section 50C is a deeming provision and Assessing Officer is obliged to compute capital gains by taking valuation arrived at by DVO in place of the actual consideration received by assessee,  assessee is entitled to challenge correctness of DVO's valuation before CIT(A) and ITAT. DVO has to be given an opportunity of hearing...

Read More

S. 50C Addition without reference to Valuation Officer not justified

Jayashree Kothari Vs ITO (ITAT Hyderabad)

Jayashree Kothari Vs ITO (ITAT Hyderabad) Sec. 50C(2) enables the Assessing Officer to make a reference to the Valuation Officer. Whenever a reference is made by the AO to the Valuation Officer, such reference has to be construed as a reference made under sec. 16A(1) of the Wealth-tax Act. We have also carefully gone through […]...

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FMV of capital asset can be determined only after hearing objections of assessee

Ms. Jagannathan Sailaja Chitta Vs ITO (Madras High Court)

Since a bare reading of scheme of Section 50C would show that assessee could object to presumptive value as per Section 50C (1) and, therefore, it was only after hearing the objections of assessee, the fair market value of capital asset as per 'Guidance Value' could be determined by authorities, therefore, the matter was remitted back to ...

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Section 50C cannot be avoided merely for sufficiency of exemption u/s 54EC

Jagdish C. Dhabalia Vs ITO (Bombay High Court)

While giving full effect to the deeming fiction contained under section 50C of the Act for the purpose of computation of the capital gain under section 48, for which section 50C is specifically enacted, the automatic fallout thereof would be that the computation of the assessee’s capital gain and consequently the computation of exemptio...

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Posted Under: Income Tax |

Section 50C cannot be invoked if sale has not taken place

Shri Vinod Kumar Chugh Vs ITO (ITAT Delhi)

Shri Vinod Kumar Chugh Vs ITO (ITAT Delhi) Conclusion: Section 50C could be invoked only when sale had taken place during the year. As the sale of vacant plot by assessee stood completed in the year 1991, there was no question of invoking the provision of section 50C for taxing the long term capital gains. […]...

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