The Tax Publishers2020 TaxPub(DT) 4389 (Mad-HC)

INCOME TAX ACT, 1961

Section 263

Guideline value has been fixed by Government for the purpose of computing Stamp Duty payable on an instrument and the guideline value would not reflect the market value of the property. Therefore, the addition made by the CIT on the ground that there was difference between actual sale consideration paid by assessee for property in question and market value fixed by the Registering Authority, would not be sustainable and accordingly, the order passed under section 263 was liable to be quashed.

Revision under section 263 - Erroneous and prejudicial order - Difference in stamp duty value and actual sale consideration -

Assessee purchased a plot for a consideration of Rs. 14,4,00,000. For the purpose of Stamp Duty, the value of the documents was fixed at Rs. 1,68,00,000. After assessment was completed, CIT invoked his power under section 263 on the ground that there was difference between actual sale consideration paid and market value fixed by the Registering Authority and that difference amounted to Rs. 24,00,000 was omitted to be treated as income of the assessee chargeable to tax under the head 'Income from Other Sources'. Accordingly, he directed the AO to assess differential amount of Rs. 24,00,000. Held: It is settled that guideline value has been fixed by Government for the purpose of computing Stamp Duty payable on an instrument and the guideline value would not reflect the market value of the property. Therefore, the addition made by the CIT on the ground that there was difference between actual sale consideration paid by assessee for property in question and market value fixed by the Registering Authority would not be sustainable and accordingly, the order passed under section 263 was quashed.

REFERRED :

FAVOUR : In assessee's favour

A.Y. : 2014-15



IN THE MADRAS HIGH COURT

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