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Capital Gain on Sale by Bank Public Auction

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This query is : Resolved

Golden Acres (Querist)
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25 September 2020 Hi,
My query is as under:

Mr.ABC had mortgaged his residence in Mumbai to a Bank. Upon default the bank took possession and has Auctioned his property by public auction.

Value of the residence as per Ready Reckoner: Rs.3.50 cr
However the bank auctioned the property at much lower value of: Rs.2.75 cr

It is clear to Mr.ABC that he will have to pay LT Capital Gain on this sale. However the Sale consideration for the purpose of Capital Gain should be taken as RR vale (3.50 cr)or Auction value (Rs.2.75 cr).

If Auction value is acceptable, under what provision can he claim this reduction in sale value.

Please advise.

Thank You

CA R SEETHARAMAN

CA R SEETHARAMAN (Expert)
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25 September 2020 See the link.
Adopt public action value for stamp duty.

https://www.mondaq.com/india/trials-appeals-compensation/805500/guidelines-for-determination-of-market-value-for-computing-the-stamp-duty-on-a-sale-certificate-bombay-high-court

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