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TMI Blog2013 (10) TMI 1024X X X X Extracts X X X X X X X X Extracts X X X X ..... including the registration value fixed by the State. Sub-section (3) provides that if the fair market value fixed by the Valuation Officer is in excess of the registration value, then the registration value should be considered for levy of the capital gains tax. In the instant case, it is to be noticed that the assessee has not availed of the opportunity to question the correctness of the registration value fixed by the State Government. If he had done so, then the assessing authority would have invoked the power of appointing a Valuation Officer for assessing the fair market value. When the registration value is not the disputed question, now, at this stage, it is not permissible for the assessee to contend that the registration value is excessive and disproportionate to the market value of the property, in the absence of contra material, the deemed full value of consideration as stated in section 50C of the Income-tax Act would come into effect. When the capital gain is assessed on notional basis, whatever amount invested in new residential house within the prescribed period, under section 54F of Income-tax Act the entire amount invested, should get the benefit of deductio ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... paid by the assessee at Rs. 1,93,506 was deducted and the net income chargeable to tax under capital gains was assessed at Rs. 34,06,494. Further, the assessing authority had given the deduction of Rs. 20,00,000 towards investment in construction of residential house at Gangavathi and assessed the long-term capital gains at Rs. 14,06,494 and the tax payable is assessed at Rs. 4,96,989. The assessee filed an appeal before the Commissioner of Income-tax (Appeals) who confirmed the order of the Assessing Officer. The assessee filed an appeal before the Income-tax Appellate Tribunal, Bangalore. The Appellate Tribunal upheld the order of the assessing authority and dismissed the appeal. The assessee, aggrieved by the said order of the Appellate Tribunal, has filed this appeal. The assessee has formulated as many as eight substantial questions of law in the appeal memo, which are as follows : (a) Whether, on the facts and in the circumstances of the case, the Income-tax Appellate Tribunal is justified in upholding the order of the assessment order passed by the assessing authority and the appellate order of the Commissioner of Income-tax (Appeals), Hubli ? (b) Whether, on the facts ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ? (g) Whether, on the facts and in the circumstances of the case, the Income-tax Appellate Tribunal is correct in law in holding that the legal fiction created by virtue of section 50C in determining the capital gain cannot be extended to section 54F of the Act and that section 54F of the Act has to be applied only for the definite and limited purpose for which it is created ? (h) Whether the order passed by the Income-tax Appellate Tribunal suffers from perversity on account of the Tribunal embarking upon the speculative assets and theorizing when the adjudication of the appeal preferred by the petitioner having regard to the subject matter of "lis" before the Tribunal based upon the respective position and the stand of each of the parties to the appeal, did not entail such consideration and evaluation as pursued by the Tribunal and the lower authorities ?" After considering the arguments of the appellant and the Revenue, the following substantial questions of law would arise for consideration in this appeal : "1. Whether the registration value fixed by the State authorities under the Stamp Act would constitute full consideration value for the purpose of levy of long-term ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the stamp valuation authority would have notwithstanding anything to the contrary contained in any other law for the time being in force, adopted or assessed, if it were referred to such authority for the purposes of the payment of stamp duty. (3) Subject to the provisions contained in sub-section (2), where the value ascertained under sub-section (2) exceeds the value adopted or assessed or assessable by the stamp valuation authority referred to in sub-section (1), the value so adopted or assessed or assessable by such authority shall be taken as the full value of the consideration received or accruing as a result of the transfer." Section 50C(1) is a deeming provision wherein the registration value fixed by the State Government under the Stamp Act is deemed to be considered as the full value consideration. Section 50C(2), however, permits the assessee to contend before the assessing authority that the registration value fixed by the State under the Stamp Act is excessive and does not correspond with the fair market value of the property as on the date of the transfer and that the assessee should not have challenged the levy of stamp duty under the Stamp Act as being excessive ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... her words, the ultimate object is to curb the growth of black money. When the capital gain is assessed on notional basis, whatever amount invested in new residential house within the prescribed period, under section 54F of Income-tax Act the entire amount invested, should get the benefit of deduction irrespective of the fact that the funds from other sources are utilized for new residential house. In that context, whatever the total amount actually invested by the assessee for construction of house at Gangavathi should be deducted irrespective of the fact that part of the funds invested are from different sources and not from the capital gains. In that view of the matter, the amount assessable towards net capital gain should be Rs. 10,06,494. The counsel for the appellant submits that the levy of interest is harsh. The provisions of section 50C of the Income-tax Act was the latest introduced provision. The assessee was not aware of the said provision it is further submitted that the assessee is a resident of Gangavathi the plot at Bangalore was allotted to him as he was a freedom fighter and he was not aware of the actual market value of the property at Bangalore, he was guided b ..... X X X X Extracts X X X X X X X X Extracts X X X X
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