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TMI Blog1985 (5) TMI 17X X X X Extracts X X X X X X X X Extracts X X X X ..... of love and affection. It was urged that the Income-tax Officer was wrong in coming to the conclusion that the transfer was made with the object of avoidance of liability under section 45. The Appellate Assistant Commissioner agreed with this argument and observed that the Income-tax Officer had brought on record no material to substantiate that the transaction was effected with the object of avoidance or reduction of liability under section 45. He, therefore, cancelled the Income-tax Officer's order in respect of capital gains. Before the Tribunal, no serious argument was made in regard to the applicability of section 52(1) of the Act. The Tribunal held that in the absence of any evidence to show that the transfer was made with the object ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... from an assessee is directly or indirectly connected with the assessee and the Income-tax Officer has reason to believe that the transfer was effected with the object of avoidance or reduction of the liability of the assessee under section 45, the full value of the consideration for the transfer shall, with the previous approval of the Inspecting Assistant Commissioner, be taken to be the fair market value of the capital asset on the date of the transfer. " The necessary ingredients of the section are firstly, that there should be a direct or indirect connection between the person who acquires the capital asset and the assessee. Secondly, the Income-tax Officer should have reason to believe that the transfer was effected with the object o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ncome-tax Officer the fair market value of a capital asset transferred by an assessee as on the date of the transfer exceeds the full value of the consideration declared by the assessee in respect of the transfer of such capital asset by an amount of not less than fifteen per cent. of the value so declared, the full value of the consideration for such capital asset shall, with the previous approval of the Inspecting Assistant Commissioner, be taken to be its fair market value on the date of its transfer. " It is no doubt true that even if the materials do not justify action under section 52(1), if such materials disclose that the conditions for invoking provisions of section 52(2) have been satisfied, the Tribunal can go into that question ..... X X X X Extracts X X X X X X X X Extracts X X X X
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