Taxpublishers.in - InterestingDecision/Flash_16357.htm - Tax Publishers Your Tax Solution Hub

Share via Whatsapp 224 Views


The Tax Publishers ITO v. Kondal Reddy Mandal Reddy [ITA No. 848/Hyd/2015 & Cross Objection No. 01/Hyd/2016, dt. 13-5-2016] : 2016 TaxPub(DT) 2515 (Hyd-Trib) "Full value of the sale consideration" does it refer to actual consideration received only or even deemed consideration under section 50C *Facts:* Assessee had sold a property at a consideration of 20 lakhs. The stamp value of the same was 89.60 lakhs. Thus applying sec. 50C the stamp value as presumed to be the deemed consideration and brought the difference 69.60 lakhs to capital gains. Assessee claimed reinvestment benefit in new property for 1.57 crores. This was negated by officer that the full value of consideration as per section 54F can only be Rs. 20 lakhs thus the difference of the reinvestment benefit cannot be allowed under section 54F. On appeal Commissioner (Appeals) granted the section 54F benefit based on the 1.57 crores reinvestment. Department thus went in appeal: Held in favour of the assessee that the term full value of consideration as per section 54F can refer to the taxed capital gain only and the deeming of section 50C cannot be imputed into the same by giving it a reading as only the actual consideration is allowable under section 54F. (1) Raj Babbar v. ITO (2013) 56 SOT 1 (ITAT) (Mum.) (2) Gouli Mahadevappa v. ITO (2013) 356 ITR 90 (Kar.) upheld .deeming fiction on FVC given in section 50C cannot be extended to section 54F (para 8.19) as the same is an exemption provisions and is a complete code in itself and it does not override others CIT v. ACE Builders (P.) Ltd. [2006] 281 ITR 210 : [2005] 144 Taxman 855 (Bom.).

The Tax Publishers

ITO v. Kondal Reddy Mandal Reddy [ITA No. 848/Hyd/2015 & Cross Objection No. 01/Hyd/2016, dt. 13-5-2016] : 2016 TaxPub(DT) 2515 (Hyd-Trib)

"Full value of the sale consideration" does it refer to actual consideration received only or even deemed consideration under section 50C

Facts:

Assessee had sold a property at a consideration of 20 lakhs. The stamp value of the same was 89.60 lakhs. Thus applying sec. 50C the stamp value as presumed to be the deemed consideration and brought the difference 69.60 lakhs to capital gains. Assessee claimed reinvestment benefit in new property for 1.57 crores. This was negated by officer that the full value of consideration as per section 54F can only be Rs. 20 lakhs thus the difference of the reinvestment benefit cannot be allowed under section 54F. On appeal Commissioner (Appeals) granted the section 54F benefit based on the 1.57 crores reinvestment. Department thus went in appeal:

Held in favour of the assessee that the term full value of consideration as per section 54F can refer to the taxed capital gain only and the deeming of section 50C cannot be imputed into the same by giving it a reading as only the actual consideration is allowable under section 54F.

(1) Raj Babbar v. ITO (2013) 56 SOT 1 (ITAT) (Mum.)

(2) Gouli Mahadevappa v. ITO (2013) 356 ITR 90 (Kar.) upheld

.deeming fiction on FVC given in section 50C cannot be extended to section 54F (para 8.19) as the same is an exemption provisions and is a complete code in itself and it does not override others CIT v. ACE Builders (P.) Ltd. [2006] 281 ITR 210 : [2005] 144 Taxman 855 (Bom.).