TMI Blog2010 (8) TMI 528X X X X Extracts X X X X X X X X Extracts X X X X ..... provisions as mentioned in Section 50C will not be applicable to Section 54F so far as the meaning of full value consideration is concerned as deeming provision mentioned in Section 50C is for specific asset and for the purpose of Section 48 of I.T. Act, 1961. - ITA No. 9/JP/2010 - - - Dated:- 13-8-2010 - ORDER PER N.L. KALRA AM. The assessee has filed an appeal against the order of the Id. CIT(A) II, Jaipur dated 3rd Nov., 2009 for the assessment year 2006-07. 2. The assessee has raised four grounds of appeal and during the course of proceedings before us, the ld.AR has stated that grounds of appeal 2 and 3 are not pressed. Hence, these grounds of appeal are dismissed. 3. The grounds of appeal Nos. 1 and 4 of the assessee are as under:- 1 1. In the facts and circumstances of the case and in law the ld. CIT(A) has erred in confirming the action of the AO in computing the long term capital gains at Rs. 10,58,783/- against the declared long term capital gains of Rs. 5,558/-. The action of the Id. CIT(A) is illegal, unjustified, arbitrary and against the facts of the case. Relief may please be granted by assessing the long term capital gains at Rs. 5,558/- only as ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... f full value of consideration as per Stamps Duty Act then the capital gains which can be taxable after-considering the investment to the extent of Rs. 16.74 lacs till the date of return will come to Rs. 1,39,377/-. The assessee in the balance sheet has showed an amount of Rs. 12.74 lacs as advance for flat and therefore, the AO was duty bound to allow deduction in case the AO was enhancing the capital gains. 4.1 The Id. CIT(A) after considering the submissions held as under that the assessee is not entitled to get deduction u/s 54F :- "I have considered facts of the case and arguments taken by Shri Sogani quite carefully. It is a fact that the appellant has not raised the claim u/s 54F either at the time of filing of return of income or during the course of assessment proceedings . Further , time and again, the AO has given opportunities before adopting the long term capital gains to make any further submission/ claim but the appellant preferred not to make the said claim even in the assessment proceedings. The availability of deduction u/s 54F is subject to fulfillment of various conditions and those conditions were not fulfilled during the course of assessment proceedings. Fu ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ncurred in connection with transfer and the cost of acquisition of the asset and the cost of any improvement thereto. Hence, we will have to first ascertain the full value of the consideration. In respect of transfer of capital asset being land or building, full value of the consideration to be adopted for the purpose of Section 48 is defined in Section 50C of the Income tax Act. It will be useful to reproduce Section 50C(1) of the Income tax Act. "50C(1) Where the consideration received or accruing as a result of the transfer by an assessee of a capital asset, being land or building or both, is less than the value adopted or assessed by any authority of a State Government (hereafter in this section referred to as the "stamp valuation authority") for the purpose of payment of stamp duty in respect of such transfer, the value so adopted or assessed shall, for the purpose of Section 48, be deemed to be the full value of the consideration received or accruing as a result of such transfer." 7.1From the above sub-section, it is clear that in case the consideration received is less than the adopted value the value adopted by Stamp Valuation 'Authority then the value so adopted is to ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of the 1922 Act was in pari material to the provisions of Section 48 of the present Act. The Supreme Court was of the view that the expression "full value of consideration* in the main part of Section 12B(2) of the Act cannot be construed as having a reference to the market value of the asset transferred but the expression only meant, the full value of a consideration received by the transferor in exchange of the capital asset transferred by him. The Supreme Court also observed that in the case of a sale the full value of consideration is the full sale price actually paid. It was further of the view that the expression 'full value* means the whole price without any deduction, whatsoever, and it cannot refer to the adequacy of the price bargained for. Nor did it have any necessary references to the market value of the capital asset which is the subject matter of the transfer.' Hence, the meaning full value of consideration as mentioned in different provisions of the Act except in Section 48, one will have to consider the full value of consideration as specified in sale deed. 7.2 Before ascertaining as to how the deduction u/s 54F is to be given, it will be useful to reproduce Se ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the transfer of the capital asset as reduced by any expenditure incurred wholly and exclusively in connection with such transfer. The meaning of full value of consideration in explanation 54F(I) will not be governed by meaning of word of full value of consideration as mentioned in Section 50C. The value adopted for stamp duty is to be considered as full value of consideration for the purpose of computing the capital gains u/s 48. Section 54F(1) says that capital gains is to be dealt with in accordance with the provisions of sub-sections (a) and (b).of Section 54F(1) of the Act. In the instant case , the cost of new asset is not less than the net consideration then the whole of the capital gains will not be charged even if the capital gains has been computed by adopting the value adopted by Stamp Registration Authority. It is clearly mentioned in Section 54F(4) also that net consideration which is not appropriated towards the purchase of new asset then the same is to be taxed in case such net consideration not appropriated is not deposited in the capital gain account, it is not necessary that the new asset should be got registered before filing of the return. The requirement of law ..... X X X X Extracts X X X X X X X X Extracts X X X X
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