LCI Learning

Share on Facebook

Share on Twitter

Share on LinkedIn

Share on Email

Share More

Saquib Shaikh   30 November 2023

Mobadla value less than bazaar bhav

I had purchased flat in dec-2022. The stampy duty was paid on ₹58,00,000(fifty eight lacs). While applying for my Capital Gain and Taxation my CA noticed recently the difference in the value of mobadla and bazaar bhav. The Mobadla is written as ₹28,00,000(twenty eight lacs) and bazaar bhav is written ₹58,25,745..86(approx 58 lacs). The property is owner my mother first owner and I son being co-owner. CA says the difference between the Mobadla and Bazaar bhav is more than 10% and hence I ll have tax around 4.5lacs and my mother will also have tax around 4.5lacs. I have registered and paid all stamp duty on 58 lacs. Please guide.


 3 Replies

T. Kalaiselvan, Advocate (Advocate)     01 December 2023

This involves practical issues, hence it will be your auditor who can give proper and correct clarification after going through the details.

P. Venu (Advocate)     01 December 2023

Yes, the matter requires professional consultation.

Sanskriti Tiwari   02 December 2023

The variance between the stated property values (Mobadla and Bazaar Bhav) has implications for capital gains tax under Section 50C of the Income Tax Act, 1961, when the sale consideration is less than the value adopted by the stamp valuation authority. The Act prescribes that if the consideration received or accruing from the transfer of a capital asset is less than the value adopted for stamp duty, the latter will be deemed as the full value of consideration for computing capital gains.

However, Section 50C provides relief if the difference is within 10% of the declared sale consideration. In your case, as the variation exceeds 10%, the stamp duty value of ₹58,00,000 will be considered the full value for computing capital gains for both you and your mother.

The case of "Smt. Renu Jhunjhunwala vs. ITO" emphasizes that the stamp duty value is conclusive evidence of the property's fair market value unless proved otherwise. Given this, although you paid stamp duty on ₹58,00,000, the disparity might lead to additional tax liabilities based on the higher valuation of ₹58,25,745.86.

Consult with your CA to explore any possible remedies or provisions that might apply in your case, such as challenging the stamp valuation report or exploring other valuation methods to establish the property's fair market value.

Leave a reply

Your are not logged in . Please login to post replies

Click here to Login / Register