Tax on deemed sale value

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Dario Dias (Querist)
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04 September 2010 I sold a property in 2008 for 50 Lacs The stamp duty authority calculated the market value at 75 Lacs which is calculated at the highest rate/sq.meter of that zone.There are other posh towers built by private builders,mine is built by MHADA.30 lacs is the 1981 valuation value and 20 lacs invested in REC.Why am I asked to pay capital gain tax on the difference 25 lacs amount not received(will never receive for that premise)? If I accept and pay the tax, will the difference be considered to be my deemed income and made to pay tax on assumed interest earned on the assumed income of 25 lacs?

CA Ketan Jain

CA Ketan Jain (Expert)
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04 September 2010 As per section 50C if stamp value is more than the sale consideration than stamp value will be taken as sale consideration and accordingly capital gain will be calculated.

If your property value is Rs. 30 lakh then there will be no capital gain after taking into indexation in consideration.