12 July 2009
Sir, We are well aware of the amendment in the recent budget regarding gift in kind which says difference between the FMV and consideration paid is Deemed income (Gift). We are also well aware of the fact that sec 50C says that where the consideration received on sale of land or buliding is less than the FMV (Stamp Value) then the capital gain is worked on Stamp Value eventhough actual consideration is less. Does this not amount to double taxing on the same income? Is this worthwhile?
12 July 2009
By giving the gift the income generating asset is tranferred from Y to Z. and if you apply logic from the day of trnasfer y income is reduced and assume for the time being that z do not have tax liability. Therefore tax savings for Y will be 160000*30% 48000 per year. Roughly he saves 50000 per year.
Therefor the law makers are correct and there is no undue double taxation. What they are collecting is only a part of loss in revenue.
CAclubindia
