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TMI Blog2024 (6) TMI 881X X X X Extracts X X X X X X X X Extracts X X X X ..... case of Greenfield Hotels Estates (P.) Ltd. [ 2016 (12) TMI 353 - BOMBAY HIGH COURT] held that Section 50C of the Act would not be applicable while computing capital gains on transfer of leased hold rights in Land and buildings. The Hon'ble Delhi ITAT in the case of Noida Cyber Park (P.) Ltd., [ 2020 (10) TMI 563 - ITAT DELHI] held that Section 50C of the Act covers only capital asset being land or building or both; it would not cover transfer of leasehold rights in land and building. Deeming provision has been incorporated to substitute the value adopted or assessed or assessable by stamp valuation authority in place of consideration received or accruing as a result of transfer, in case the latter is lower than the former. It, therefor ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 3. The relevant facts giving rise to this appeal are that the assessee, a salaried employee, filed his Income Tax Return (In short, the ITR ) of the relevant assessment year 2011-12 on 17.02.2012 declaring income of Rs. 5,06,850/- which was processed under section 143(1) of the Act. Later on; the AO, based on the AIR information that the assessee who sold a leasehold property for Rs. 60,00,000/- did not offer the capital gains derived thereon for tax in the relevant year, reopened the case. Since the appellant/ assessee did not file any proof of cost of acquisition of the leasehold property during the assessment proceedings, therefore, the consequential reopened assessment was completed at income of Rs. 75,94,850/-, under section 147/143(3) ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n case of transfer of leasehold rights. The Ld. Counsel drew out attention to the provisions of section 50C of the Act, wherein it has been specifically mentioned that this Section is applicable to those capital assets only which are land or building or both. 6. The Ld. Senior Departmental Representative (In short, the Sr. DR ), placing emphasis on the finding of the AO and the CIT(A), prayed for dismissal of the appeal. However, on specific query, he admitted that there is no judicial pronouncement holding that the provisions of Section 50C of the Act is applicable on the leasehold property. 7. We have heard both the parties at length and have perused the material available on the record. Since the issue of validity of reopening of the ass ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ing, forming part of an industrial undertaking .. . Thus, it is palpable from section 54D of the Act that 'land or building' is distinct from 'any right in land or building'. 9. The Hon'ble Supreme Court in the case of Amarchand N. Shroff 48 ITR 59 has held that a deeming provision cannot be extended beyond the purpose for which it is enacted. Similar view was reiterated by the Hon'ble Supreme Court in the case of Mother India Refrigeration Industries (P.) Ltd. 155 ITR 711 by laying down that legal fictions are created only for some definite purpose and these must be limited to that purpose and should not be extended beyond their legitimate field . In view of the above decisions of the Hon'ble Supreme Court, it i ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t, being land or building or both, is less than the value adopted or assessed [or assessable] by any authority of a State Government (hereafter in this section referred to as the stamp valuation authority ) for the purpose of payment of stamp duty in respect of such transfer, the value so adopted or assessed [or assessable] shall, for the purposes of section 48, be deemed to be the full value of the consideration received or accruing as a result of such transfer. 13. On-going through the above provisions of section 50C of the Act, it transpires that where the full value of consideration shown to have been received or accruing on the transfer of a capital asset, being land or building or both, is less than the value adopted or assessed or as ..... X X X X Extracts X X X X X X X X Extracts X X X X
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