INCOME TAX ACT, 1961

Section 50C

Capital gains - Invocation of section 50C - Assessee produced voluaction report of second appellant stage -

Assessee declared sale consideration of Rs. 65 lakhs as exempt on sale of land which assessee claimed as agricultural land. AO on perusal of sale deed noticed that Circle Rate of property was Rs. 7 crores and sale consideration had been shown at Rs. 65 lakhs only which was less than Circle Rate of the property. Assessee pleaded that property in question is agricultural land and as such Section 50C would not apply. However, AO invoked section 50C and made addition. Before Tribunal, assessee contended that AO could make a reference to DVO in order to determine fair market value of property. Held: Since assessee had not objected to stamp valuation under section 50C before AO when AO had given specific show cause notice to assessee under section 50C, AO was not obliged to make a reference to DVO under section 50C rather assessee made a specific statement before AO that since land in question was an agricultural land or that assessee suffered capital loss, therefore, section 50C was not applicable. These facts clearly show that assessee had been making different statements at different stages and in the absence of production of purchase deed and source of construction made on the impugned property, would clearly show that valuation report had been manipulated by assessee just to avoid payment of capital gains tax. Accordingly, AO was justified in making addition.

REFERRED :

FAVOUR : Against the assessee.

A.Y. : 2016-2017

SUBSCRIBE FOR FULL CONTENT

OR Try Reload the Page