I have purchased the residential property on auction in FY 2014-15 at bid price which is less than stamp duty value of property on the date of registration.At the same the difference between stamp duty value and purchased price is more than 50k.
Today i have received the notice from department u/s 148 saying i have escaped the income tax for the said transaction.
Do i need to pay tax on property purchased less than stamp duty value when property itself is purchased on fair market value through auction?
In my opinion & as I understand the income tax act ...I can say is only 10 percent variation from municipal value of property is allowed from financial year 2019 / 20.
if auction price is less by 10 percent compared with municipal price, then tax has to be paid as per municipal value
still requested to reconfirm from professional
CAclubindia
