The Income Tax Appellate Tribunal (ITAT) by its Pune Bench in the case of Shri Dinar Umeshkumar More, Nashik v. ITO held that provisos to Section 50C inserted by Finance Act, 2017 are retrospectively applicable.
The appeal has arisen from the issue of valuation of the property which has been executed by the assessee along with his sister and wife with M/s. Jayesh Builders in computation of the long term capital gain.
It has been contended by the assessee relying upon the first two provisos to Section 50C that the stamp value should be considered with reference to the date on which the Development Agreement was signed and possession of ‘Sai Chhaya’ (property) was handed over. The AO adopted stamp value of the property on the date of execution of the Registered Conveyance Deed.
The Tribunal constituting of Hon’ble members Shri R.S. Syal and Shri Partha Sarathi after considering the materials in hand and arguments made by the parties made a reference to both the provisos to Section 50C inserted by Finance Act, 2017 wherein if certain consideration is received through a banking channel, the stamp value for the purposes of the transfer shall be considered with reference to the date on which the agreement to sell was entered and not the date of registration of the deed. Further, this benefit was available only after the condition mentioned under proviso 2 is satisfied. The Tribunal after going through the factual matrix of the present case held the two provisos retrospectively applicable in the present case.
The Tribunal hence remitted the matter back to the AO for computing the capital gain afresh in line with the observations made by the Tribunal.
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