Guidance value as per the provisions of section 50C of the I.T.Act for calculating capital gains


Quick Summary
This Income Tax Appellate Tribunal ruling addresses the use of guidance value for calculating capital gains under Section 50C of the IT Act. The Assessing Officer used the property's guidance value, which exceeded the sale deed amount, to determine capital gains. The tribunal found that the assessee's mother had participated in assessment proceedings, dismissing the ground of non-service of notice.

Court :
ITAT Bangalore

Brief :
This appeal at the instance of the assessee is directed against the CIT(A)�s order dated 29.11.2019. The relevant assessment year is 2008-2009.

Citation :
ITA No.155/Bang/2020 : Asst.Year 2008-2009

IN THE INCOME TAX APPELLATE TRIBUNAL
BANGALORE “SMC-B” BENCH, BANGALORE
Before Shri George George K, Judicial Member
ITA No.155/Bang/2020 : Asst.Year 2008-2009

Smt.Arifa Yasmeen
No.635, 34th Cross, 2nd Main Road
4th T Block, Jayanagar
Bengaluru – 560 041.
PAN : ACCPY6958P.

vs

The Income Tax Officer
Ward 7(2)(1)
Bengaluru.

Appellant by : Smt.Preethi Patel, Advocate
Respondent by : Sri.Ganesh R.Ghale, Standing Counsel
Date of Hearing : 16.09.2021
Date of Pronouncement : 20.09.2021

O R D E R

The Registry has marked delay of 2 days in filing this appeal before the Tribunal. At the time of hearing, the learned AR submitted that the appeal has been filed on Monday, 03rd February, 2020, thus, the intervening days were Saturday and Sunday, being 1st and 2nd February, 2020. Therefore, the learned AR submitted that there is no delay in filing this appeal. After perusing the material on record, I find that there is no delay in filing this appeal before the Tribunal. Hence, I proceed to dispose of the appeal on merits.

2. The assessee along with co-owners had sold a site of BTM Layout, Bangalore on 13.07.2007 for a total consideration of Rs.34,50,000. During the course of assessment proceedings, notice u/s 142(1) was issued and assessee’s mother appeared and the case was discussed with her. The Assessing Officer noticed that guidance value of the property which was sold on 13.07.2007 was Rs.41,82,000. As the guidance value was more than the value recorded in the sale deed, the Assessing Officer adopted the guidance value as per the provisions of section 50C of the I.T.Act for calculating capital gains.

3. I have heard rival submissions and perused the material on record. As regards the issue of non-service of notice u/s 148 of the I.T.Act, I find that the assessee’s mother had appeared before the A.O. and notice was served to her. The assessee’s mother had had participated in the assessment proceedings. Therefore, the ground taken in the appeal regarding non-service of notice u/s 148 of the I.T.Act is dismissed.

4. In the result, the appeal filed by the assessee is partly allowed for statistical purposes.
Order pronounced on this 20th day of September, 2021.

Please find attached the enclosed file for the full judgement

FAQ :

Section 50C of the Income Tax Act deals with the special provision for full value of consideration in cases of transfer of property, specifically concerning the use of stamp duty or guidance value for calculating capital gains.

The property in question was sold on 13th July 2007.

The Assessing Officer adopted the guidance value because it was higher than the actual sale consideration recorded in the sale deed, as per the provisions of Section 50C.

Yes, the assessee's mother appeared before the Assessing Officer and participated in the assessment proceedings.

The tribunal found that there was no delay in filing the appeal, as the intervening days were a weekend.

The appeal filed by the assessee was partly allowed for statistical purposes.

 
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