TMI Blog2001 (2) TMI 84X X X X Extracts X X X X X X X X Extracts X X X X ..... fficer applied the provisions of section 45(4) of the Income-tax Act, 1961, and held that the fair market value of the property so transferred was Rs. 5,36,100 as determined by the District Registrar, Ranga Reddy District. The difference between the amount determined by the District Registrar and the amount of written down value (book value) of the asset in question was added in the hands of the assessee-firm as short-term capital gains, which was to the extent of Rs. 3,18,54 S. The assessee-firm carried the matter in appeal to the Commissioner (Appeals). The Commissioner (Appeals) did not agree with the contention of the assessee-firm and hence confirmed the addition made by the Assessing Officer. The matter was carried in further appeal t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... erred in favour of the said partner and the District Registrar, Ranga Reddy District, determined the fair market value for the purpose of stamp duty at Rs. 5,36,100. The contention of the assessee is only that the consideration that was received by the assessee-firm should be treated as the fair market value. In support of his contention, he relied upon the decision of the Supreme Court in CIT v. George Henderson and Co. Ltd. [1967] 66 ITR 622. In the said case, the Supreme Court was considering the provisions of section 12B of the Indian Income-tax Act, 1922. In the said provision, there is no reference to the fair market value. The reference in the said provision was to the full value of the consideration for which the sale, exchange or t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... What is fair market value was also defined in clause (22B) [of section 2] which is as under: "(22B) 'fair market value'... (i) the price that the capital asset would ordinarily fetch on sale in the open market on the relevant date; and (ii) where the price referred to in sub-clause (i) is not ascertainable, such price as may be determined in accordance with the rules made under this Act." In view of the above, it is clear that the value of the capital asset, on transfer, as a result of the dissolution of the firm, should be the fair market value and not the written down value or any other value. The contention of the assessee was negatived by the Tribunal observing that the reverse interpretation was sought for by counsel for the a ..... X X X X Extracts X X X X X X X X Extracts X X X X
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