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2009 (2) TMI 235 - AT - Income TaxBusiness Income - Applicability of provisions of section 50C on a business asset - difference between stamp duty valuation and actual sale consideration - HELD THAT:- It is well settled principle that, when the language of the statute is plain and explicit and does not admit of any doubtful interpretation, the Court cannot expand the meaning of the words used by the legislature. So far as s. 50C is concerned the language of the said section is so clear in respect of its intention that it is brought on statute book by way of deeming provision in the nature of Explanation to s. 48. Moreover, after the Finance Act. 2002, in which s. 50C was brought on the statute book, the CBDT issued a Circular No. 8 of 2002, clarifying the provisions of Finance Act, 2002, relating to the direct taxes. In respect of the newly inserted s. 50C in the Explanatory Notes the CBDT has explained the purpose of introducing s. 50C Therefore, It is abundantly clear from the explanation given in the CBDT circular that the basic intention to insert s. 50C is for the purpose of determining full value of sale consideration for the purpose of computation of capital gains u/s. 48. It is well-settled rule of interpretation that meaning ascribed by the authority (sic). The issuing of notification or circular is good guide of contemporaneous exposition of the position of the law and this rule is popularly known as 'contemporanea expositio'. This rule of interpretation has been given recognition by the Hon'ble Supreme Court in the case of K.P. Varghese vs. ITO [1981 (9) TMI 1 - SUPREME COURT]. In our opinion, there should not be any cloud of doubt that s. 50C has application only to the extent of determining sale consideration for computation of capital gain under Chapter IV-E of the Act and it cannot be applied for determining the income under other heads. We are therefore, of the opinion that, when admittedly in the present case the sale of the flats is treated as the business income and not as a capital gain, hence, the provision of s. 50C is not applicable. We, therefore, delete the addition made by the AO and set aside the order of the CIT(A) on this issue. The ground is therefore, allowed. Sale of two car parking spaces - AO has noted that the two car parking spaces were also sold along with the two flats and assessee has not shown any amount on the sale of the car parking expenses (sic-space) - he also noted that though the assessee has received the amount on the sale of car parking space, the same is not shown in the books of account - he made the additions to the income of the assessee. HELD THAT:- On perusal of the copies of the sale deeds, it is seen that the car parking space is also composite part of sale of flat and prices of the flats are inclusive of the car parking spaces allotted to the buyer. In our opinion as per evidence before us no separate price is received in respect of car parking space. We, therefore, hold that there is no justification for making addition towards car parking space in respect of two flats and hence we delete the same. The appeal is partly allowed for statistical purposes.
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