Case law regarding section 50c

Tax queries 552 views 3 replies

Neha ghulyani

JOB

28 Points Posted on 04 February 2013

I Have a query regarding section 50C, the Situation is :-

Sale Price of Land & Building is 2.4Crores

Circle rate of Land is 1.23Crores

Cost of building as on 1-4-1991 is 0.23Crores

Residue amount is 0.92Crores and we have transfered the amount in block of assets.

Can Assessing Officer question our treatment to the excess amount by stating that it should be taken as Value of land ?

Replies (3)

CA Kumar Mukesh

CA CMA FINAL and Advance Excel Trainer

6886 Points Posted on 04 February 2013

problem can be raised by AO u/s 50C if Value stated for Land & building or both less then value adopted by Stamp Value authority (State Govt.)

Since Value disclosed in deed exceed value adopted for the purpose of payment of stamp duty

there are no objection will be raised by AO

Parimel

Administration

41 Points Posted on 06 February 2013

madam, can you please clarify when the sale took place (even if the query is hypothetical)? Also, please state whether depreciation has been claimed for the building? As the computation of gains requires the w.d.v of the block of assets (building) on the date of sale? Also whether the sale deed specifically attributes value separately for the land and building purchased by the other party? also since land does not form part of the block of assets, the A.O will be very much within his jurisdiction to attribute the excess/residue amount, after considering the above mentioned issues, to be the excess consideration recieved on sale of land and thereby taxing it as capital gains, long term or short term, as the case may be.

Also, please state to which block of assets have you transferred the excess 0.94( and not 0.92 crores)? and what do you mean by transferred - whether reduced or added to the w.d.v of the block of assets?