Income tax on purchase of property less than market price

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Arun Kumar Ghosh (Querist)
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18 December 2021 I am going to purchase a property - bare open roof of an already built 2 storied building underneath. My legal consultant told me that during registering this property, I have to pay stamped duty not only on the roof being purchased, but also on the estimated one storied flat to be built on the roof in the later years. For the roof Rs 15 lakhs is the purchase price to be paid to the seller, but I need to register it on Rs 25 lakhs, which is the purchase price of the roof as well as the estimated market value of the flat to be built later (as confirmed by Registration Authority). While consulting with a Tax Consultant, I was told that I have to add to my income the difference of the actual purchase cost and the market value ( i.e. on Rs 10 lakhs).
I am a bit confused as regards why I need to pay tax on Rs 10 lakhs, since I have not made any real income anywhere. My query is under which section / sub-section such tax is chargeable, if it is admissible as per Income Tax Act.
Request expert's valuable advice on the implication of income tax for the aforesaid property transaction.

CA R SEETHARAMAN

CA R SEETHARAMAN (Expert)
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18 December 2021 No need to pay stamp duty on one storied flat to be built on the roof in the later years.
Wrongly advised by your legal consultant.
The value of the building as on the date of registration will be considered for stamp duty.
No need to consider future additions.
When you reduce the registration value of future additions there is no need to pay any income tax.

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