TMI Blog2012 (8) TMI 808X X X X Extracts X X X X X X X X Extracts X X X X ..... chargeable u/s. 45 of the Act for A.Y. 2003-04 or any subsequent year. As such, the impugned capital gains, being chargeable u/s. 45 for the current year, i.e., AY 2006-07, section 50C would be per se applicable - The words "adopted" or "assessed" (as also "assessable") in s. 50C(1) qualify the word "value" preceding it, and not the word "transfer", thus the assessee's case that the assessment of the fair market value of the property (land) by the SVA was done only on 27-11-2007 and, therefore, there being no assessment by it by the end of the relevant year, i.e., 31-03-2006 cannot be accepted - in favour of revenue. - IT Appeal NO. 498 (KOL.) OF 2012 - - - Dated:- 9-8-2012 - SANJAY ARORA, GEORGE MATHAN, JJ. ORDER Sanjay Arora, Accountant Member This is an Appeal by the Revenue arising out of the Order by the Commissioner of Income-tax (Appeals)-XXXII, Kolkata ('CIT(A)' for short) dated 11-01-2012, allowing the assessee's appeal contesting its assessment u/s. 143(3) of the Income-tax Act, 1961 ('the Act' hereinafter) dated 04-08-2008 for the assessment year (A.Y) 2006-07. 2. The Revenue has raised three grounds per its present appeal, reading as under:- "1. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... olkata, along with the two other co-owners, being group companies, i.e., Bagari Investments Pvt. Ltd. and Bagari Synthetics Pvt. Ltd., to fifteen (15) different buyers, per separate conveyance deeds, i.e., qua each conveyance. The respective agreements to sales were in all cases executed on 15-10-1996. While five (5) conveyance deeds were executed on 15-01-1998, and registered - after paying stamp duty - on 22-02-1999, the balance ten (10) were executed on 26-05-2006; the corresponding date of registration being 27-11-2007, when the stamp duty was finally assessed. The bulk of the sale consideration stood received, as well as possession made over, in almost all cases by January, 1998, whereat the five (5) deeds were executed. The assessee, however, returned long term capital gains ('LTCG' for short) arising on the said transfers for the current assessment year, i.e., A.Y. 2006-07, at Rs. 97,14,463/-. The AO, however, assessed it at Rs.1,73,32,543/- by deeming the sale consideration at Rs. 214.18 lakhs i.e., as against the actual sale consideration (i.e., in respect of the assessee's 2/5th share) of Rs.138 lakhs, or increasing it by Rs. 76,18,080/-. It is this enhancement of sale ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... has taken place during the relevant year. In fact, we also observe no dispute with regard to this aspect before the authorities below and, consequently, no finding by them in the matter per their respective orders. The only issue, therefore, that survives, and which stood agitated before us (also refer ground nos. 2 and 3 by the Revenue) is the applicability or otherwise of section 50C to the impugned transfers per the 15 (fifteen) conveyance deeds in the facts and circumstances of the case. 4.4 Section 50C stands co-opted on the statute by Finance Act, 2002, with effect from 01-04-2003. Its relevant part reads as under:- 'Special provisions for full value of consideration in certain cases. 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 purposes of section 48, be deemed to be the full value of the consid ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ncome or the actual filing of return, the same being available, and only in relation to the transfer, capital gains on which has arisen for the relevant year, the same would stand to be adopted. The words "adopted" or "assessed" (as also "assessable") in s. 50C(1) qualify the word "value" preceding it, and not the word "transfer". The only condition is that the said value should be in respect of the relevant transfer, i.e., of a defined capital asset, capital gains on which is assessable for the relevant year. In our view, the purport or relevance of the word 'assessable', the prospective operation of which is being advanced by the assessee as the reason for non-applicability of the provision of s. 50C, would be where there is a difference between the value adopted or assessed, and that assessable, on the other. In fact, as we see it, the provision (50C(1)) contemplates no difference in value adopted or assessed or the value assessable by the SVA. It is to be appreciated that the value only seeks to estimate or determine the fair market value of the relevant capital asset on the date of transfer. As such, whether the assessee's assessment took place during the relevant year or subs ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... supra ) is based on the decision in the case of Navneet Kumar Thakkar v. ITO [2008] 110 ITD 525 (Jd). In the facts of that (latter) case, the transfer, capital gains arising on which was subject to tax, was per an unregistered document. The transfer under the Act being complete, it was held that there was no warrant for the substitution of the actual sale consideration with the value adopted or that may be assessed by the SVA, i.e., if and when the said transfer is subject to registration, for the purpose of computing capital gains under the Act. Accordingly, the position existing prior to the co-option of section 50C of the Act would apply. In fact, this represents one more area or circumstance under which the word "assessable", which came on the statute only later, would become relevant. The 'transfer' in the case of Mangal Shree Estate Ltd . ( supra ) was, again, only per an unregistered document, with the tribunal finding the words 'assessable' in s. 50C (1) as operative from a later date, and which, as clarified earlier, have not been taken into consideration by us. The said decisions are clearly distinguishable on facts inasmuch as each transfer in the instant case stan ..... X X X X Extracts X X X X X X X X Extracts X X X X
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