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TMI Blog2023 (9) TMI 626X X X X Extracts X X X X X X X X Extracts X X X X ..... ty for stamp duty purpose at Rs. 31.73 crores. During the original assessment proceedings leading to an order dated 5 Feb. 2010 under Section 143(3) of the Act, the agreement of sale which evidenced the sale consideration as well as stamp duty valuation was considered by the Assessing Officer and on application of Section 50C of the Act, long term capital gain was computed, taking the sale consideration at Rs. 31.73 crores. The grounds given in support of the impugned notice dated 4 January 2013 is that during subsequent assessment proceedings for A.Y. 2008-09, information provided by the Sub Registrar in the Registration and Stamps Department, Andhra Pradesh indicated that the market value of the subject land sold by the petitioner at Hyderabad during the A.Y. was Rs.179.84 crores. The annexure to the aforesaid information clearly states that chargeable value for the purpose of stamp duty is Rs. 31.73 crores. In view of the above, Section 50C of the Act appears to prima facie covers the petitioner's case. This is so as Section 50C of the Act mandates that the valuation adopted for assessment by the State Govt. for stamp duty purposes would be deemed to be the full value of the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... total income of Rs. 151,53,91,778/- which was subsequently enhanced to Rs. 162,76,07,723/- by filing revised returns and offering to tax the capital gain on the sale of the said property. 6. Pursuant to the initiation of scrutiny proceedings and notice received from the Assessing Officer (A.O.), petitioner submitted various documents vide its letter dated 6th November 2009 which included copy of the Sale Deed. Subsequently, petitioner also filed details of expenses reduced from the capital gain working for the said property. Petitioner also filed a copy of the Notification dated 20th April 2007 that was issued by the Government of Andhra Pradesh pursuant to the application that the Top Notch has filed before the Revenue Department, Government of Andhra Pradesh challenging the order of the District Registrar and Collector, Ranga Reddy District, Andhra Pradesh. 7. The final assessment order came to be passed on 5th February 2010 under Section 143(3) read with Section 144C (13) of the Act and petitioner's total income was assessed at Rs. 333,14,55,620/-. Various adjustments were made but what is relevant to this petition is that in view of Section 50(C) of the Act full value of sal ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... f action u/s. 147 of the Income Tax Act, 1961 "..The assessee company filed its return of income for A.Y. 2006-07 on 29-11-2006 declaring total income at Rs. 151,53,91,778/-. The return was processed under section 143(1) of the Act. The case was selected under scrutiny and the draft assessment was completed under section 143(3) r.w.s. 144C(1) on 29-12-2009 determining total income at Rs. 333,14,55,620/- and final order under section 143(3) r.w.s. 144C(13) of the Act on 05-02-2010 determining the total income at Rs. 333,14,55,620/-. 2. On perusal of the assessment record for A.Y. 2006-07, it was observed that the assessee had entered into a sale deed to sale the land at Survey No. 1 situated at Uppal Mandal, R.R. Dist. The said land along with the structure was purchased by M/s. Top Notch Infrastructure Pvt. Ltd. The total sum of consideration paid by the purchaser was disclosed to Rs. 12.21 Crores. However, by invoking the provisions of section 50C of the Act in respect of land at Hyderabad, the sale consideration was adopted to Rs. 31,73,89,000/-. 3. Subsequently, during the course of assessment proceedings for A.Y. 2008-09 in this case, it was reported by the Sub-Registr ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... r reads as under : 9.4 Coming to the sale consideration, it is observed from the Registered Sale Deed submitted by the assessee that the value of the property sold has been determined by the stamp valuation authority at Rs. 31,73,89,000/- on which the assessee has paid the stamp duty as against the sale consideration of Rs. 12.21 crores mentioned in the sale agreement. Therefore, this attracts the strict application of the provisions of Sec. 50C of the I.T. Act. When asked as to why the Long Term Capital Gain shall not be computed by adopting the value determined by the stamp valuation authority, the assessee has no tangible explanation to give. Under the circumstances, I have to adopt Rs. 31,73,89,000/- as the full value of sale consideration instead of the agreement price by invoking the deeming provisions of Sec. 50C of the I.T. Act and accordingly the Long Term Capital Gain on the sale of factory land at Hyderabad is computed as below : Particulars Amount (Rs.) Sale Consideration 31,73,89,000 Less : Indexed value of land 1,63,055 Long Term Capital Gain 31,72,25,945 (emphasis supplied) 13. Therefore, the issue of capital gains as regards the said property ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... alue adopted or assessed or assessable by the stamp valuation authority on the date of agreement may be taken for the purpose of computing full value of consideration for such transfer. Though not raised initially, later in view of the amendment to Section 50(C) appellant had challenged even this determination of capital gains on the grounds that the capital gains should be worked out on the basis of the date of the agreement fixing the amount of consideration and not the date of registration for the transfer of the capital asset and therefore capital gains should be determined on the basis of consideration of Rs. 12,21,00,000/- and not Rs. 31,73,89,000/-. The appellate authority accepted petitioners submissions that this amendment should be read to have been introduced with retrospective effect. The CIT[A] has given its decision accepting petitioner's contentions and directing the Assessing Officer to take the date of agreement for stamp duty value consideration. Therefore, in our view nothing would survive in the impugned notice itself.
17. In the circumstances, we make the Rule absolute in terms of prayer clause - (a).
18. Petition disposed. X X X X Extracts X X X X X X X X Extracts X X X X
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