INCOME TAX ACT, 1961

Section 148

Reassessment - Validity - Determination of the value of immovable property - Handing over possession of the property

Assessee along with other co-owner had sold immovable property for a sale consideration as against the guidance value as per Registration Authorities, it was Rs. 3,29,17,500 and as such, difference in sale consideration being to an extent of Rs. 2,70,17,500, it attracted capital gains tax as per the provisions of section 50C. The basis for determining the capital gains tax was valuation. The market value of the property or actual sale consideration whichever was higher was required to be adopted. AO found that in the return of income, assessee neither declared the capital gains or claimed exemption from capital gains tax. AO held that there was reason to believe that income chargeable to tax under capital gains had escaped assessment under section 147. CIT(A) and Tribunal dismissed the appeal of assessee. Held: By applying section 53A of Transfer of Property Act and section 2(47)(v), it was rightly held that physical possession of property was not transferred to purchaser under the agreement of sale. Tribunal held that in absence of any finding about handing over of possession in any earlier year, it could not be said that property was transferred in any earlier year and for ascertaining same, matter was remanded back to CIT(A) with regard to issue of possession. That apart, issue relating to valuation, Tribunal had noticed that AO had not referred the matter to the valuation officer as required under section 50C(2). Therefore, finding recorded by Tribunal was purely question of facts not giving rise to substantial question of law being formulated.

REFERRED :

FAVOUR : Against the assessee

A.Y. :

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