30 May 2011
Hello experts! One of our client has sold urban agricultural land in march11. The buyer had challenged the stamp valuation done by stamp valuation authority which they reduced by 20% since he paid all d stamp duty on it. My querry is whther seller (our client) can also challenge d same stamp valuation dept, as for income tax purpose as its actual sale value is less than d stamp value adopted by stamp valuation even after reducing for the purpose of payment of stamp duty. since we need to tak this notional value as FULL VALUE OF CONSIDERTAION . ur comments would be of immense help Thanks in advance.
10 June 2011
*50C. Special provision for full value of consideration in certain cases.—(1) Where the consideration received or accruing as a result of the transfer by an assessee of a capital asset, being land or building or both, is less than the value adopted or assessed by any authority of a State Government (hereafter in this section referred to as the “stamp valuation authority”) for the purpose of payment of stamp duty in respect of such transfer, the value so adopted or assessed shall, for the purposes of section 48, be deemed to be the full value of the consideration received or accruing as a result of such transfer.
(2) Without prejudice to the provisions of sub-section (1), where–
(a) the assessee claims before any Assessing Officer that the value adopted or assessed by the stamp valuation authority under sub-section (1) exceeds the fair market value of the property as on the date of transfer ;
(b) the value so adopted or assessed by the stamp valuation authority under sub-section (1) has not been disputed in any appeal or revision or no reference has been made before any other authority, court or the High Court,
the Assessing Officer may refer the valuation of the capital asset to a Valuation Officer and where any such reference is made, the provisions of sub-sections (2), (3), (4), (5) and (6) of section 16A, clause (i) of sub-section (1) and sub-sections (6) and (7) of section 23A, sub-section (5) of section 24, section 34AA, section 35 and section 37 of the Wealth-tax Act, 1957 (27 of 1957), shall, with necessary modifications, apply in relation to such reference as they apply in relation to a reference made by the Assessing Officer under sub-section (1) of section 16A of that Act.
Explanation.–For the purposes of this section, “Valuation Officer” shall have the same meaning as in clause (r) of section 2 of the Wealth-tax Act, 1957 (27 of 1957).
(3) Subject to the provisions contained in sub-section (2), where the value ascertained under sub-section (2) exceeds the value adopted or assessed by the stamp valuation authority referred to in sub-section (1), the value so adopted or assessed by such authority shall be taken as the full value of the consideration received or accruing as a result of the transfer.
I presume that:- 1. The valuation of property for stamp duty was reduced by the authority by 20% subsequently on application made by purchaser ( referred as reduced reference value) 2. The seller has the copy of the order of revised valuation 3. The sale consideration received is less than the reduced reference value 4. now the assessee i.e. the seller want to take such reduced reference value for the purpose of Capital gain computation Ans : Since, the assessee (seller) can prove that the valuation has been revised by the valuation office( stamp duty officer) the same can be claimed and shall be allowed by the assessing officer.