Actual property sale consideration is factual issue; stamp duty value alone cannot decide, case remanded for fresh assessment

HC allowed the revision, holding that the actual consideration in a property sale is a pure question of fact to be determined on the specific circumstances of each case, and cannot be inferred solely from the stamp duty valuation. The authorities had failed to consider the material circumstance that the purchased portion was under tenancy of the assessee's mother and was in occupation of the assessee's family, which could justify a lower sale price. Orders of all three authorities were quashed and the matter was remitted to the Assessing Officer for fresh determination of the actual consideration paid and for framing the assessment afresh in light of these observations.

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Issues involved: Challenge to order of Commissioner of Income-tax u/s 264 dismissing revision petition regarding assessment year 1984-85 based on discrepancy in sale consideration of house property.

Summary:
The High Court of Allahabad heard the writ petition challenging the order of the Commissioner of Income-tax u/s 264 regarding the assessment year 1984-85. The petitioner-assessee had purchased a house property where the market value for stamp duty was Rs. 2,07,500, but the actual consideration was stated as Rs. 1,50,000. The Income-tax Officer added only fifty per cent of the difference to the income of the assessee, as the house was purchased in two portions. The Appellate Assistant Commissioner dismissed the appeal, noting the stamp duty value and lack of documentary evidence. The assessee then filed a revision u/s 264 before the Commissioner, who emphasized that stamp duty was paid according to circle rates. The High Court held that the actual consideration passing between parties may differ from stamp duty value, and the facts of each case must be considered. The petitioner's explanation about the property being under tenancy was crucial. Consequently, the orders of all three authorities were quashed, and the matter was remitted to the Income-tax Officer for redetermination of the actual consideration paid by the assessee. The assessment was to be finalized accordingly, and the writ petition was allowed without costs.

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