Section 56 (Amended): Tax on Purchase of Immovable Property at insufficient consideration
Applicability: Individual or HUF
Crux of the Section: Purchase of immovable property by individual or HUF for inadequate consideration (Consideration minus Stamp duty value > 50,000) taxable in the hands of the recipient under “Income from other Sources”.
Conditions:
i) If consideration is less than stamp duty value by an amount exceeding Rs.50,000.
Analysis:
i) Since this section is applicable only on HUF and Individuals the Immovable Property can be purchased on the name of other assessee i.e. Private Limited Company.
Section 43CA – Application of Stamp Duty Valuation of assets other than Capital Assets
Crux of the Section: Seller of Land or building or both, which is held as stock in trade have to pay tax on (stamp duty value – consideration).
Applicability: All assessee
Conditions:
i) If consideration is less than stamp duty value arising on account of transfer of an asset being land or building or both (not being a capital asset) shall be substituted by the valuation done by stamp valuation authorities.