Capital gains transfer timing under section 50C required clear findings on possession before stamp valuation could be sustained.

Addition based on stamp valuation under section 50C could not be sustained without a clear factual finding on when transfer was completed and possession of the immovable property was actually handed over. The agreement to sell and sale deed indicated that possession was to follow execution of the sale deed, and no cogent evidence showed earlier delivery of possession by the assessee. Since capital gains taxation in the relevant year depended on the timing of transfer and possession, the existing findings were vacated and the matter was restored to the first appellate authority for fresh adjudication after examining the contractual terms and legal requirements governing transfer and part performance.

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Issues: Whether the addition made by adopting the stamp valuation under section 50C was sustainable without a clear finding on when possession of the immovable property was actually handed over, and whether the matter required re-adjudication.

Analysis: The assessment and appellate orders did not clearly determine when the transfer was completed or when possession was delivered. The agreement to sell and the sale deed contained clauses indicating that possession would follow execution of the sale deed, while the assessee did not place cogent evidence to show that possession had been handed over earlier. For a transfer of capital asset to attract capital gains in the relevant year, the factual issue of transfer and possession had to be determined in the light of the contractual terms and the legal requirements relating to transfer and part performance.

Conclusion: The existing findings were vacated and the issue was restored to the first appellate authority for fresh adjudication in accordance with law after examining when possession was actually handed over.

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