There has been long ranging debate as to whether provisions of Section 50C are applicable or not when partner contributes as capital any assets in the firm. Or Whether sales consideration will be determined according to the provision of Section 45(3) itself.
I came across a very recent order of Lucknow tribunal which states:
Where immovable property is transferred by a partner to the firm as a capital contribution and registration does not take place by paying stamp duty, the case would be covered under section 45(3) and provisions of section 50C cannot be invoked. Section 50C override section 45(3) only if the sale deed is sought to be registered by paying stamp duty.
Carlton Hotel (P) Ltd. vs. ACIT (2009) 122 TTJ 515 (Luck.)
Although the line which I have highlighted has become redundant as after the passing Finance Act, 2009, Section 50C is applicable whether stamp duty is actually assessed or not.
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