INCOME TAX ACT, 1961

Section 50C

Capital gains - Full value of consideration - Relevant date - Date of agreement v. date of sale deed

Assessee sold certain immovable property. AO invoked section 50C and adopted the full value consideration as per stamp duty valuation as on the date of sale deed. Assessee submitted that once DLC rate as on the date of agreement was less than sale consideration actually received by assessee, no further addition was called for under section 50C. As per AO proviso to section 50C was inserted by Finance Act, 2016 with effect from 1-4-2017 and, therefore, it was prospective in nature and could not be applied for the year under consideration. Held: Proviso to section 50C is having retrospective effect being remedial clarificatory in nature. Accordingly, AO was directed to adopt as DLC rate on the date of agreement as full value of consideration and if sale consideration shown in the sale deed was more than DLC rate of the property as on date of agreement then no addition under section 50C was called for.

REFERRED :

FAVOUR : In assessee's favour.

A.Y. : 2015-16

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