Mr. Soham, a builder, entered into an agreement on 1.4.2023 with Mr. Aman to transfer 4 th Floor in Tower A of a new project for 1,50,00,000. He…

I Tax consequences in the hands of Mr. Soham As per section 43CA, where the consideration received or accruing is less than the stamp duty value of an asset (other than capital asset), being land or building or both and such stamp duty value exceeds 110% of the consideration received or accruing, then the stamp duty value shall be deemed to be the full value of the consideration. However, where the date of agreement is different from the date of registration, stamp duty value on the date of agreement can be considered provided whole or part of the considered is received by way of account payee cheque/ bank draft/ ECS or through any other prescribed modes on or before the date of agreement. In this case, since 25lakhs is received by cash on the date of agreement, stamp duty value on the date of registration is to be considered. Since such stamp duty value (₹ 1.75 crores) exceed 110% of the consideration received (₹ 1.50 crores), business income would be computed in the hands of Mr. Soham, for A.Y.2024-25, taking sale consideration of 1,75,00,000 as the full value of consideration arising on transfer. II Tax consequences in the hands of Mr. Aman In case, immovable property is received for inadequate consideration, the difference between the stamp duty value and actual consideration would be taxable under section 56 (2) (x) in the hands of the recipient, if such difference exceeds the higher of 50,000 and 10% of actual sales consideration. Where the date of agreement is different from the date of registration, stamp duty value on the date of agreement can be considered provided whole or part of the considered is received by way of account payee cheque/ bank draft/ ECS or through any other prescribed modes on or before the date of agreement. In this case, since 25lakhs is received by cash on the date of agreement, stamp duty value on the date of registration is to be considered. Accordingly,25,00,000 would be taxable in the hands of Mr. Aman under the head "Income from Other Sources" in A.Y.2024-25 since the difference of 25,00,000 exceed - 15,00,000, being the higher of 50,000 and - 15,00,000 (10% of consideration).