Section 50C and 55A of IT Act, 1961

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Devendra

Devendra (Querist)
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06 July 2011 Can anybody please explain me section 50C and 55A in simple language with an example?

CS Bijoy

CS Bijoy (Expert)
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07 July 2011 Section 50C has been inserted by the Finance Act, 2002 with effect from 1st April, 2003. Provision when construed literally and applied to cases in which value of transfer is honestly or truly stated/declared as per contractual but which is lower than the value assessed or adopted by the stamp valuation authority, would produce absurd and irrational picture because the assessee would be required to pay capital gain tax on the amount which he had not contracted and which has not accrued or received by him as profit or gain

Reference to Valuation Officer [Sec.55A]
Where the value of the assets as claimed by the assessee is in accordance with the estimate made by are registered valuer (who works in a private capacity under a licence issued by the Board and his valuation is not bunding on the Assessing Officer), but the Assessing Officer is of opinion that the value so claimed is less than its fair market value [sec. 55C(a)].
Where the Assessing Officer is of opinion that the fair market value of the asset exceeds the value of the asset by more than Rs.:25,000 or 15 percent of the value claimed by the assessee, whichever is less [Sec.55A(b)(i), read with rule 111AA].

C A S.S.Agarwal, M.Com.,LL.B,

C A S.S.Agarwal, M.Com.,LL.B, (Expert)
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07 July 2011 50C is for adoption of stamp duty valuation

55A is the valuation as done by the valuation officer when the AO is not satisfied with the valuation adopted by the assessee for the purpose of capital gains.

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