Income Tax : Section 50C: For property sales, if the sale price is lower than the value assessed by Stamp Valuation Authority, that value is co...
Income Tax : Discover the real implications of Section 50C and significant court rulings affecting real income taxation. Explore crucial tax de...
Income Tax : Learn about tax implications for sellers and buyers of immovable property. Understand capital gains, stamp duty, tax withholding, ...
Income Tax : Understand how Sec 50C & 43CA of Income Tax Act affect taxation of immovable property sales. Learn about capital gains, business i...
Income Tax : Income-Tax Implications for the Sellers, if any Immovable Property is Sold for a consideration less than Stamp Duty Value...
Income Tax : Bombay Chartered Accountants' Society has made a Representation on 'Suggestions for Amendments in the Income Tax Act', on 24th May...
Income Tax : In relation to computing capital gains tax liability on transfer of land or building, amendment made via the Finance Act, 2016 giv...
Income Tax : Rationalisation Of Section 50c To Provide Relief Where Sale Consideration Fixed Under Agreement To Sell- Section 50C makes a spec...
Income Tax : Karnataka High Court ruled on V.S. Chandrashekar vs. ACIT regarding tax treatment of land transactions, applicability of Section 5...
Income Tax : ITAT Bangalore ruled on the taxability of Transferable Development Rights (TDR) in the case of Smt. Sowmya Sathyan vs. ITO, clarif...
Income Tax : ITAT Pune ruled on capital gains in Smt. Vimal Baburao Jadhav Vs ITO. The Tribunal held Section 50C inapplicable, recalculating LT...
Income Tax : Bombay High Court holds that Section 50C of the Income Tax Act does not apply to tenancy right transfers, dismissing the Revenueâ€...
Income Tax : ITAT Mumbai rules that Section 50C of the Income Tax Act does not apply to tenancy right transfers, dismissing the Revenue’s app...
Income Tax : Notification No. 8/2020-Income-Tax- CBDT has notified Other electronic modes by inserting New Income TAx Rule 6ABBA. It also amend...
Whether Ld. CIT(A) erred in directing the AO to adopt the value of the property sold as per DVO report for the purpose of computing capital gains in place of value adopted by Stamp Valuation Authority and considered by AO as per provisions of Section 50C(1) of the IT Act, 1961. Held, Yes If the fair market value as assessed by the DVO is lower than the value adopted by Stamp Duty Authorities for collecting stamp duty. Then value so adopted by DVO has to be adopted by the AO for the purpose of computation of LTCG.
Facts (a) that the appellant had disclosed all material facts and (b) raising a legal claim, even if it is ultimately found to be legally unacceptable, cannot amount to furnishing of inaccurate particulars of income,
Recently ITAT Mumbai held that in the case of Chiranjeev Lal Khanna v. ITO held that considering the facts of the case and clauses in the agreement, the taxpayer has transferred land and building to the developer would be chargeable to tax as capital gains. Accordingly, Section 50C of the Income-tax Act, 196 1(the Act) would be applicable.
Recently ITAT Mumbai in the case of ITO vs. United Marine Academy (Mumbai ITAT) held that Assessing Officer thus was right in applying the provision of section 50C to the transfer of depreciable capital assets covered by section 50 and in computing the capital gain arising from the said transfer by adopting the stamp duty valuation.
Renu Hingorani vs. ACIT (ITAT Mumbai) – The AO had not questioned the actual consideration received by the assessee but the addition was made purely on the basis of the deeming provisions of s. 50C. The AO had not doubted the agreement or given any finding that the actual sale consideration was more than the sale consideration stated in the sale agreement. The fact that the assessee agreed to the addition is not conclusive proof that the sale consideration as per agreement was incorrect and wrong. Accordingly, there was no concealment of income or furnishing inaccurate particulars of income.
It was held that transfer of development rights does amount to transfer of land or building and therefore s. 50C is applicable is applicable because u/s 2(47)(v) the giving of possession in part performance of a contract as pers. 53A of the Transfer of property Act is deemed to be a transfer.
The Mumbai bench of Income-tax Appellate Tribunal (the Tribunal) in the case of Kishori Sharad Gaitonde v ITO (ITA No. 1561/M/09) held that for attracting the provisions of Section 50C of the Income-tax Act, 1961 (the Act) a capital gains should arise from the sale of land or building or both. However, since in the present case the taxpayer earned capital gains from the transfer of tenancy right which is not a capital asset, being land or building or both, the Tribunal held that Section 50C of the Act was not applicable to the instant case.
Capital gains-Scope of section 50C-Extension of section 50C to purchaser-Section 50C creates a legal fiction for taxing capital gains in the hands of the seller and it cannot be extended for taxing the difference between apparent consideration and valuation done by Stamp Valuation Authorities as undisclosed investment under section 69. This fiction cannot be extended any further and, therefore, cannot be invoked by AO to tax the difference in the hands of the purchaser.
The Assessing Officer added the difference between purchase price disclosed in the sale deed and purchase price of the property adopted for the purpose of paying the stamp duty to the total income of the assessee as income from unexplained sources. The Commissioner of Income-tax (Appeals) deleted this addition by holding that section 50C is a deeming provision for the purpose of bringing to tax the difference as capital gain.
Section 50C creates a legal fiction for taxing capital gains in the hands of the seller and it cannot be extended for taxing the difference between apparent consideration and valuation done by Stamp Valuation Authorities as undisclosed investment u/s 69 in the hands of the purchaser.
