Applicability of sec 56 (2)

Immovable property  aquired free of cost or rather without paying any consideration(Gift) , would be taxable u/s56(2).

In your case, Difference would not be included in your income & hance not taxable.

If it would have been movable property, then such difference is chargeable to tax.

jayesh is right, 56(2) is not applicable in your case and hence nothing is taxable and cost of acquision would be 7 lakhs only

ok. I am just concened about the lines in Section 56 (2) which read after sub section vii (c)..

Provided that where the stamp Duty value of immovable property as referred to in sub clause (b) is disputed by the assessee on grounds mentioned in sub section (2) of section 50C, the Assessing Officer may refer the valuation of such property to a Valuation Officer, and the provisions of section 50C and sub section (15) of section 155 shall, as far as may be, apply in relation to the stamp duty value of such property for the purpose of sub-clause (b) of Sec 56 (2) as they apply for valuation of capital asset under those sections............

Now what does this mean ????

that apply when you dont pay anything for property like when receive as gift. but since you are buying that section is not applicable to you

Agree with Jayesh and Ashish gupta  , section 56(2) is not applicable in this case

Like in your case, you are claiming that you have purchased the immovable property at the price below the stamp duty value (or value as per S.V.A is higher than Fair market value of the asset) and if value so adopted or assessed by S.V.A is not disputed / challenged in any appeal/ revision before any court or authority then A.O may refer the case to the Valuation officer

  Then if

1. Value assessed by Valuation officer  is HIGHER than value adopted by S.V.A  then value as per S.V.A will be adopted.
2. Value assessed by Valuation officer  is LOWER than value adopted by S.V.A (but more than declared by you)  then value as per valuation officer will be adopted.
3. If value is lower than your declared value then the value which you declared will be adopted.