Section 50C transfer date depends on completion of registration, while alleged title dispute warranted limited fresh valuation enquiry.

For income-tax purposes, transfer of immovable property under section 50C is complete only on completion of registration, not on mere presentation of the deed for registration; sections 47 and 75 of the Registration Act do not advance the transfer date. The assessee's plea that defective title prevented any transfer was rejected because the registered purchase deed had not been set aside and the assessee had executed registered sale deeds transferring whatever rights he possessed. On the alleged title dispute and lower sale consideration, the material was insufficient for a final finding, so limited fresh enquiry was required on whether the dispute justified the stated value.

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Issues: (i) Whether, for the purpose of section 50C, the transfer of the immovable property was to be taken as complete on the date of presentation of the deed for registration or on the date of its actual registration, and whether the additional ground on assessment year was admissible; (ii) Whether the assessee's plea that his title was defective and therefore there was no transfer in the eyes of law was sustainable; (iii) Whether the issue of alleged title dispute and consequent lower sale consideration required fresh factual enquiry.

Issue (i): Whether, for the purpose of section 50C, the transfer of the immovable property was to be taken as complete on the date of presentation of the deed for registration or on the date of its actual registration, and whether the additional ground on assessment year was admissible?

Analysis: Sections 47 and 75 of the Registration Act, 1908 were held not to govern completion of sale for income-tax purposes. A registered document may operate retrospectively for certain purposes, but that does not mean the transfer is complete before registration. The relevant date for tax authorities is the date on which registration is completed, and the assessee's attempt to shift the transaction to an earlier assessment year was not accepted.

Conclusion: The transfer was held to be complete only on registration on 01.04.2013, section 50C was applicable in assessment year 2014-15, and the additional ground was rejected.

Issue (ii): Whether the assessee's plea that his title was defective and therefore there was no transfer in the eyes of law was sustainable?

Analysis: The registered purchase deed in favour of the assessee had not been set aside by any competent court. The assessee had himself executed registered sale deeds transferring whatever rights he had in the property, which constituted a transfer of capital asset. The alleged defect in title did not negate the transfer for income-tax purposes.

Conclusion: The plea that there was no transfer because of defective title was rejected.

Issue (iii): Whether the issue of alleged title dispute and consequent lower sale consideration required fresh factual enquiry?

Analysis: The material on record was insufficient to conclusively determine whether the alleged title dispute affected possession, marketability, or the sale price. A limited enquiry was necessary to ascertain whether there was a justifiable reason for the property being sold below the stamp valuation and what the market/saleable value was in those circumstances.

Conclusion: The matter was restored to the first appellate authority for limited fresh consideration on that issue.

Final Conclusion: The addition under section 50C was upheld in principle, but the controversy relating to the effect of the alleged title dispute on valuation was remitted for limited reconsideration, leaving the appeal only partly succeeded for statistical purposes.

Ratio Decidendi: For income-tax purposes, a transfer of immovable property is not complete merely on presentation of the deed for registration; the relevant date is completion of registration, and sections 47 and 75 of the Registration Act do not make the transfer complete earlier.

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