It is not only perceived but an open secret in india that sale transactions of immovable properties are undervalued leading to leakage of tax revenue causing losses to the government and unaccounted money is not good for the health of the society in. Section 50c of income tax act 19612017 provides for special provision for full value of consideration in certain cases. The provisions of said section and its applicability are discussed in detail herein below. Section 50c, incometax act, 1961 2015 85special provision for full value of consideration in certain cases. By way of this appeal, the assessee appellant has challenged correctness of the order dated 14th october 2014 passed by the citaxvi, ahmedabad in the matter of assessment under section 1433 r. Section 50c, which was introduced by the finance act, 2002 with effect from april 1, 2003, contains special provisions for valuation of consideration in certain cases. Further, the provisions of section 56 of the act falls under the chapter computation of income, whereas section 68 comes under aggregation of income and setoff or carry forward of loss. Scope and impact of provisions of section 50c of the act. Section 224xv of the act, defining income, includes therein any sum of money or value of property referred to in section 562viiviia of the act. Insertion of new section 50c income tax department. Tax alert delivering clarity 1 april 2019 itat deletes additions made us 562viib to the total income on account of share premium received enhancement of income by the cita is deleted facts of the case. Section 50c of the incometax act is not applicable to. Section 562viib of the act brings to tax any money received by a company from a resident.
Aattachments ttachments ttachments should be in pdf zip should be in pdf zip. Download the list of sections of income tax act,1961 in pdf and excel format. Recently, the ahmedabad bench of the incometax appellate tribunal the tribunal in the case of dharamshibhai somani1 the taxpayer held that amendment2 made in section 50c3 of the incometax act, 1961 the act is curative in nature and therefore applies retrospectively with effect from 1 april 2003, i. Provisions relating capital gain us 50 of income tax act. Section 50c is applicable to transfer of leasehold rights of a land for 99 years since it is a capital asset 25 april 2014 b background as per section 50c of the incometax act, 1961 the act when a capital asset, being land or building or both, is transferred for a consideration which is less than the. Stakes in transactions in immovable properties are quite high and so are the tax implications.
Since section 561 of the act is residuary head of income, it falls in the head of income f i. Taxability of sale of land or building section 50c cleartax. Apportionment of income between spouses governed by portuguese civil code. It is a deeming provision which provides for substitution of actual sale consideration for value adopted assessed assessable as per stamp valuation authority sva if, the former. Section 50c of the income tax act is not applicable to transfer of leasehold rights in land 6 february 2015 background recently, the pune bench of the income tax appellate tribunal the tribunal in the case of kancast pvt.
As per 562vii, the following received by an individul or huf was considered as income. Section 50c deals with the computation of capital gain on sale of land or building or both which is held as capital asset. After section 50b of the incometax act, the following section shall be inserted with effect from the 1st day of april, 2003, namely. Chapter iv sections 1459 of income tax act, 1961 deals with provisions related to computation of total income. The taxpayer claimed that the stamp duty valuation as on 24 april 2007 was not relevant for ascertaining the sale consideration for the purpose of section 50c of the act.
Section page contents division one 111 incometax act, 1961 page u arrangement of sections i3 u text of the incometax act, 1961 as amended by the finance act, 2011 1. Click to view the institutions registered under section 80g, 12 a and more. Section 50c is applicable to transfer of leasehold rights. Section 50c of the income tax act, 1961 the act history and brief background of the evolution of section 50c under the act of 1922, first proviso to section 12b2 entitled the assessing officer to ignore the actual consideration received for the transfer and to substitute a notional or artificial consideration based on the fair market value. Recently1, the chennai bench of the incometax appellate tribunal tribunal held that section 50c of the incometax act, 1961 act, requiring substitution of actual consideration with stamp duty value in certain cases, would not apply in case of transfer of land by a taxpayerpartner as his capital contribution to the partnership firm. Section 50c was inserted in the income tax act vide finance act of 2002 w. How is capital gain calculated under section 50c of income tax act. Background of section 50c income tax act, 1961 stakes in transactions in immovable properties are quite high and so are the tax implications. It is not only perceived but an open secret in india that sale transactions of immovable properties are undervalued leading to leakage of tax revenue causing losses to the government and unaccounted money is not good for the health of the society in general. Whether a tax payer can claim exemptions under both the sections, if the investment is made in the same residential. In the absence of such finding, the penalty order is liable to be quashed.
Amendment to section 50c introduced by the finance act, 2016 for. The bill proposes to insert a new section 50c in the incometax act to make a special provision for determining the full value of consideration in. Insertion of clause x in section 562 to provide that receipt of money or specified property by any person for inadequate consideration or without consideration from any person shall be subject to tax. Working of capital gain us 50 of income tax act against sale of business assets.
Income tax law has broadly classified incomes into 5 different categories for taxation purpose. Rebate of incometax in case of individuals of sixtyfive years or above omitted. Special provision for full value of consideration in certain cases. Text of remaining provisions of allied acts referred to in incometax act 1. Amendment to section 50c though inadequate is in tune with needs. Income tax act 90 of 1988 income tax amendment act 99 of 1988 income tax act 70 of 1989. Itat holds section 50c not applicable where partner. Analysis of provisions of section 562x of incometax act. Comptroller means the comptroller of income tax appointed under section 31 and includes, for all purposes of this act except the exercise of the powers conferred upon the comptroller by sections 34f9, 37ie7, 37j5, 671a, 95, 96, 96a and 101, a deputy comptroller or.
Agenda responding to show cause notice specially on on section section section 50c 68, penny stocks 50c 68, penny stocks section 68 vssection 68 vs benami benamibenamitransactions transactions. Section 360 of the code of criminal procedure, 1973, and the probation of offenders act, 1958, not to apply. Refinement of section 7c 29 august 2017 in brief section 7c of the income tax act, 1962 act no. Income tax section 50c of the incometax act, 1961 is a special provision which comes into picture whenever a capital asset being land or building is transferred sold. Income tax act 1961 complete act citation 530 bare. As per this section, the value of sale consideration should not be less than the stamp duty value which is assessed by the stamp valuation authority. Tax alert delivering clarity 23 august 2019 deloitte. The provisions of section 50c are reproduced herein below for ready reference. Section 50c was inserted by the finance act, 2002 with effect from april 1, 2003. Section 50c provides that if the value stated in the instrument of transfer is less than the valuation adopted, assessed or assessable by the. Where the consideration received or accruing as a result of the.
Dharamshibhai somani1 the taxpayer held that amendment2 made in section 50c3 of the incometax. Tax on sale of immovable property, land or building. Incometax act, 1961 hereafter referred to as the act, prohibition of benami. Hence the provision of section 50c of the act is being invoked in case of the assessee and the value as per stamp duty authority is being adopted. The income tax act provides for exemption from tax on longterm capital gains under two separate sections, section 54 and section 54f, if the investment of the gains is made for purchase or construction of a residential house. Deeming fiction under section 50c section 50c of the income tax act, 1961 hereafter referred to as the act was introduced vide finance act 2002 w. Income tax act 58 of 1962 south african government. If an assessee has sold a capital asset forming part of block of assets building, machinery etc. Stays order passed under black money act, absent counsel representation amidst covid19 pandemic. Allahabad high court in the case of commissioner of income tax vs. Section 50 of the income tax act, 1961 provides for the computation of capital gain in respect of depreciable assets. Recently1, the chennai bench of the incometax appellate tribunal tribunal held that section 50c of the incometax act, 1961 act, requiring.
Given income tax act sections list includes revised, omitted and newly added tax rules. Section 50c 1 provides that where consideration received or accruing as a result of transfer by an assessee of a capital asset. Section 50c of income tax not applicable to a builder. Notwithstanding anything contained in clause 42a of section 2, where the capital asset is an asset forming part of a block of assets in respect of which depreciation has been allowed under this act or under the indian incometax act, 1922 11 of 1922, the provisions of sections 48 and 49 shall be subject to the following modifications. Amendment to section 50c introduced by the finance act. List of sections of income tax act 1961 download pdf. One of the measures introduced by the finance minister was introduction of section 50c in income tax act vide finance act, 2002, w. Costs for purposes of section 81 of the income tax act 58 of 1962 fixing of rate per kilometre in respect of motor vehicles for the purposes of section 8bii and iii. Section 561 of the act, the income earned by the taxpayer should be classified as revenue income as per section 14 of the act but should not fall within any of the head of income a, c, d or e. Latest income tax act sections list has been provided for finance people. The provisions of section 68 of the act cannot be taken as governing by section 562viib of the act.1133 123 1595 428 1158 1307 1620 401 308 415 918 1190 1 1442 409 1138 1203 1205 1446 312 241 672 382 1069 1618 508 529 335 670 260 1411 546 187 1022