TMI Blog2016 (4) TMI 77X X X X Extracts X X X X X X X X Extracts X X X X ..... n of sale deed is adopted as full consideration, the same has to be subject to the verification whether the market value of the property at the time of sale consideration agreed upon by the parties is less than the valuation adopted by the stamp valuation authority then as per provisions of sec.50C(2) market value of the property is required to be taken after consideration of relevant facts including prevailing rate at the time of sale consideration agreed upon between the parties. In view of the above facts and circumstances of the case, we are of the considered opinion that the fair market value of the property has to be determined by the AO/DVO after considering all the relevant facts including the prevailing rate in the year 2005. Accordingly, the matter is set aside to the record of the AO for determining the fair market value of the property as per provisions of sec.50C(2) of the Act. - Decided in favour of assessee for statistical purposes. - ITA No.882/Bang/2014 - - - Dated:- 12-2-2016 - SHRI VIJAY PAL RAO, JUDICIAL MEMBER and SHRI INTURI RAMA RAO, ACCOUNTANT MEMBER For The Appellant : Shri H.N.Khincha, CA For The Respondent : Shri Sunil Kumar Agarwala, JCI ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d or at least the addition as made/sustained be deleted and interest levied be also deleted. 3. The assessee is an individual and filed his return of income on 6/5/2009 declaring a total income of ₹ 11,63,500/- consisting of income from business as well as income under the head capital gains . During the year under consideration, the assessee had sold a property at Peenya, Bangalore, for a consideration of ₹ 30,12,000/- and offered income under the head capital gains . The AO proposed to invoke the provisions of sec.50C for taking the full value of consideration as assessed by the stamp duty authority. The assessee objected to the action of the AO by explaining that the assessee had entered into an agreement for sale of the property in the year 2005 and also received part consideration on 11/5/2005 onwards up to the date of execution of the sale deed. Since the sale deed was registered on 21/7/2007, therefore, the AO applied the rate prevailing in the year 2007 as assessed by the stamp duty authority. 4. The assessee challenged the action of the AO before the CIT(A) but could not succeed as the CIT(A) has held that the argument of the assessee that sec.50C sha ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... oters vs. ACIT (ITA No.12/Vizag/2009 dt.22/6/2010 6. On the other hand, learned Departmental Representative has submitted that the assessee never produced the agreement before the AO. The agreement was not registered and therefore, it is an after-thought creation of document. Even the assessee is not having the original agreement. He has further submitted that there is no scope u/s 50C to vary the actual valuation as assessed by the stamp duty valuation authority. Thus, as per provisions of sec.50C, full consideration has to be adopted as the value assessed by the stamp duty authority for the purpose of registration of sale document. He has relied upon the orders of the authorities below. 7. We have considered the rival submissions as well as relevant material on record. The dispute before us is limited only on the point whether the rate prevailing in the year 2005 when the assessee claimed to have entered into agreement for sale or the rate prevailing in the year 2007 when the assessee has finally executed the sale deed and registered are to be adopted as full value consideration u/s 50C of the Act. There is no dispute that the assessee received payment from purchaser of t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 1) of section 50C in respect to the property sold is much higher than the actual fair market value and the property has been sold on the consideration as stipulated in the sale deed. In the last operative part of the assessment order, the Assessing Officer held that the assessee has not given any explanation in respect of applicability of provisions of section 50C(1) of the Act, therefore, for calculating short term capital gain, the value of half share of the property is taken at ₹ 39,05,000 as per value adopted by stamp valuation authority while registering the sale deed. 8. From this finding recorded by the Assessing Officer, it is clear that the assessee made a claim before the Assessing Officer that the circle rate was much higher than actual market value of the property. In this situation, section 50C(2) provides that without prejudice to the provision of sub-section (1) where the assessee claims before any Assessing Officer or authority that the value adopted or assessed by the stamp valuation authority exceeds the fair market value of the property as on the date of transfer and the value so adopted and assessed by the stamp valuation authority has not been disputed ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... han the valuation adopted by the stamp valuation authority then as per provisions of sec.50C(2) market value of the property is required to be taken after consideration of relevant facts including prevailing rate at the time of sale consideration agreed upon between the parties. A similar view has been taken by the coordinate bench of the Tribunal in the case of ITO vs. Mumtaz Begum (ITA No.877/Hyd/2015 dated 04/11/2015) in para.7 as under: 7. Having regard to the rival contentions and the material on record, we find that the only issue before us is the value to be adopted u/s 50C whether as on the date of agreement of sale or as on the date of registration. We find that similar issue came up for consideration before the ITAT, Vizag Bench in the case of M/s Lahiri Promoters (supra) and the coordinate bench has extensively dealt with the issue and after considering the ratio laid down by the Hon'ble Supreme Court in the case of K.P.Varghese Vs Income tax Officer and another (131 ITR 597) and also considering the decision of Hon'ble Madras High Court in the case of K.R. Palani Swamy and others Vs. Union of India (2008-TMI-30601 in Appeal No W.P No 4387 of 2003 vide order ..... X X X X Extracts X X X X X X X X Extracts X X X X
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