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TMI Blog2018 (12) TMI 1551X X X X Extracts X X X X X X X X Extracts X X X X ..... . No reason to interfere with the lower authorities’ action invoking section 56(2)(vii)(b) clause (ii) of the Act. For fair market value of the assets it is an admitted fact that neither of the lower authorities made any reference to the DVO. Section 56 first proviso make it clear that where the stamp duty of immovable property is disputed on grounds mentioned in sec. 50C(2), the Assessing Officer’s may refer such a valuation to the DVO. Hon'ble jurisdictional high court’s decision in Sunil Kumar Agarwal vs. CIT [2014 (6) TMI 13 - CALCUTTA HIGH COURT] holds that a reference u/s 50C has to be mandatorily made even if the assessee concerned fails to make such request therefore apply the said ratio mutatis mutandis in light of proviso hereinabove to restore the fair market value issue back to the Assessing Officer for afresh adjudication after making necessary reference to the DVO as per law.- Assessee’s appeal is partly allowed for statistical purposes . X X X X Extracts X X X X X X X X Extracts X X X X ..... een any intention on their part to tax the excess of stamp duty value over actual consideration in the hand of recipient even in case of sale of Immovable property. Therefore, they have not intended to tax the said difference in the hand of transferee in case of sale by conveyance deed and only purpose was to tax in case of gift. Now, if you kindly view specifically the provisions of section 56(2)(vii) enacted with effect from 1st October 2009 which are read as under. Where an individual or HUF receives in any previous year from any person or persons. a) Any sum of money without consideration the aggregate value of which exceeds ₹ 50,00,000.00 the whole of the aggregate value of sum. b) Any immovable property without consideration the stamp duty value of which exceeds ₹ 50,000.00 the stamp duty value of such property. Sir, again if you kindly mean the basic object of the legislature, it was to tax in case of gift i.e. without consideration. Further, by the Finance Act 2013 with effect from 01.04,2014 sub-clause (b) to clause (vi) to section 56(2) was broken into two which are read as under: (i) Without consideration the stamp duty value of which exceeds &# ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ssed to the seller by the buyer. The assessee has duly disclosed the cost of property purchased as per consideration paid by him to the seller. Therefore, the assessee has discharged is burden of proving purchase consideration a per sale deed. Now the AO was obliged to bring on record the positive evidence supporting the price assessed by the competent authority of state govt for the purpose of stamp duty. In the impugned case the AO has failed to do so and arbitrarily adapted stamp duty value and illegally added of ₹ 6,60,692.00 i.e. excess of its over actual consideration to the total income of the appellant. Sir, further, from legality point of view of stamp duty value adapted by the State Agency on which stamp duty is payable, we would like to submit as under:- 'one of the basic ingredients for making addition U/s 56(2)(vii)(b)(ii) is stamp duty value adapted by the state agency on which stamp duty was paid. At the same time the stamp duty value have been also basis for determining taxable income U/s 50C and U/s 43CA of the Act. therefore, legal validity of adapting stamp duty value in determining taxable income is of great importance and required to be considered ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rice fixed by the District Sub Registrar for stamp duty purposes as the fair market value of the property. The legislature did not intend that the capital gain should be fixed merely on the basis of the valuation to be made by the District Subs Registrar for purpose of stamp duty. The legislature has taken care to provide adequate machinery to give a fair treatment to the citizen/taxpayer. There is no reason why the machinery provided by the legislature should not be used and the benefit thereof should be refused. Even in a case where no such prayer the AO discharging a quasi judicial function, has the bounden duty to act fairly and to give a fair treatment by giving him an option to follow the curse provided by law. 3. CIT v. Sarijan Realties ltd. (2013) 40 Taxman. Commission 398 /(2014) 220 Taxman 112 (Mag)(Guj.) Deeming fiction created by section 50C which substitutes consideration received on sale of a capital asset by stamp duty valuation is applicable only in case of seller and not buyer of the property. 4. CIT v. Hanuman Prasad Ganeriwala (2014) 43 taxmann.com 133.122 Taxaman 126 (Delhi)(Mag). Circle rate as stipulated under section 50C can become starting point of e ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... aving purchased four immovable properties involving less than stamp value(es) rate(s) to the tune of ₹6,60,962/-. He raised various legal arguments before the CIT(A) which rejected. I find that sec.56(2)(vii)(b) is applicable in case of an individual or an HUF receiving any immovable property having stamp value exceeding ₹50,000/- rupees without consideration or such a consideration to be less than stamp price of the property by an amount exceeding ₹50,000/- rupees. Learned counsel vehemently contended that both the lower authorities have erred in law as well as on facts in invoking the impugned statutory provision. I find no merit in this argument since the legislature has made it clear in last proviso to sec. 56(2)(vii) that this clause does not apply to any sum of money or any property received from any relative or donor as per clauses (a) to (g) therein. This is not the assessee's case that his four transactions are in any way covered in the last proviso. I therefore do not find any reason to interfere with the lower authorities' action invoking section 56(2)(vii)(b) clause (ii) of the Act. 4. Now comes fair market value of the assets in issue. It is an admit ..... X X X X Extracts X X X X X X X X Extracts X X X X
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