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2013 (10) TMI 147 - GUJARAT HIGH COURTApplicability of section 50C of the Income tax act on trading transaction of sale and purchase of land - Held that:- Section 50C of the Act gives rise to a deeming fiction and such deeming fiction is to be applied in case of computation of capital gain under Section 48 of the Act. It is well known that a deeming fiction provided by the statute has to be applied for the purpose of which it is provided and no other. In the present case, if the Assessing Officer had utilized juntry rate as a starting point, to enquire further and ascertain the true market value of the land so sold and having brought some evidence in this direction, surely, the case of the Revenue would have been justified - Except for making reference to the juntry rates and pointing out that the juntry rate is 2.2 times higher than the sale consideration disclosed by the assessee, the Assessing Officer has brought no evidence on the record to establish that the sale deed did not reflect the full sale consideration - All that the assessee did was to apply a deeming fiction provided under Section 50C without admitting so, it was not in dispute that the plot was held as "stock in trade" and therefore sale thereof gives rise to the business income and not to capital gain – Decided against the Revenue.
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