Apparent consideration under Chapter XX-C excludes purchaser-borne conveyancing costs, while deferred payment is discounted from the transfer agreement date.

Under Chapter XX-C of the Income-tax Act, 1961, apparent consideration is the consideration stated in the transfer agreement, and purchaser-borne stamp duty, registration fee and similar conveyancing expenses cannot be deducted from it for purposes of section 269UA(b) and the payment mechanism under section 269UF. The Court also held that any deferred part of the consideration must be discounted from the date of the agreement for transfer, as expressly required by section 269UA(b), and not from a later sale deed or registration date. The computation was therefore upheld on the deferred consideration issue, while the deduction for conveyancing s was disallowed.

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Issues: (i) Whether, while determining the amount payable to the vendor under Chapter XX-C, the expenditure relatable to stamp duty, registration fee and similar conveyancing costs payable by the purchaser can be deducted from the apparent consideration under section 269UA(b) of the Income-tax Act, 1961; (ii) whether the discounted value of consideration payable after the date of the agreement for transfer has to be computed from the date of the agreement for transfer under section 269UA(b).

Issue (i): Whether, while determining the amount payable to the vendor under Chapter XX-C, the expenditure relatable to stamp duty, registration fee and similar conveyancing costs payable by the purchaser can be deducted from the apparent consideration under section 269UA(b) of the Income-tax Act, 1961.

Analysis: The statutory scheme of Chapter XX-C treats the amount specified in the agreement for transfer as the basis for both the purchase order under section 269UD and the payment obligation under section 269UF. The expression "apparent consideration" is defined in section 269UA(b) for that purpose, and the definition does not admit a deduction from the consideration stated in the agreement on account of expenses to be borne by the purchaser in completing conveyance. The Court followed the earlier binding view and declined to adopt a different contextual meaning for payment under section 269UF.

Conclusion: The deduction of stamp duty, registration fee and similar purchaser-borne conveyancing expenses from the apparent consideration was impermissible and the petitioners succeeded on this issue.

Issue (ii): Whether the discounted value of consideration payable after the date of the agreement for transfer has to be computed from the date of the agreement for transfer under section 269UA(b).

Analysis: Section 269UA(b) expressly provides that where the whole or any part of the consideration is payable after the date of the agreement for transfer, the value of such deferred consideration shall be deemed to be its discounted value as on the date of the agreement for transfer, determined by the prescribed rate of interest. The Court held that the statutory text does not support shifting the relevant date to the date of a later sale deed or registration, and the earlier Division Bench view was correctly applied.

Conclusion: The discounting of deferred consideration from the date of the agreement for transfer was valid and the petitioners failed on this issue.

Final Conclusion: The challenge succeeded only in part: the impugned orders were quashed to the extent they reduced the payable amount by deducting purchaser-borne conveyancing expenses, but the computation of discounted deferred consideration under section 269UA(b) was upheld.

Ratio Decidendi: Under Chapter XX-C of the Income-tax Act, 1961, "apparent consideration" for the purposes of purchase and payment is the consideration specified in the agreement for transfer, less no purchaser-borne conveyancing expenses, while any deferred component must be discounted from the date of that agreement in the manner prescribed by section 269UA(b).

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