Section 50C safe harbour applied where stamp valuation stayed within the permissible tolerance band, deleting the addition.

Section 50C addition was held unsustainable where the difference between the stamp valuation authority's value and the government-approved valuer's value was below the prescribed tolerance band. The third proviso to section 50C applies a safe harbour when the stamp valuation does not exceed 110% of the consideration received or accruing on transfer, in which event the actual consideration is taken as the full value of consideration under section 48. Relying on a coordinate bench view on the same issue, the ITAT Kolkata deleted the addition and granted relief to the assessee.

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Issues: Whether the addition made under section 50C on account of difference between the stamp valuation and the government-approved valuation was sustainable when the variation was within the permissible tolerance band.

Analysis: The difference between the value adopted by the stamp valuation authority and the value determined by the government-approved valuer was found to be less than 10%. The third proviso to section 50C provides a safe harbour where the stamp valuation does not exceed 110% of the consideration received or accruing on transfer, in which event the consideration received is to be taken as the full value of consideration for section 48. Following the coordinate bench view on a similar issue, the addition was held to be unsustainable.

Conclusion: The addition under section 50C was deleted and the issue was decided in favour of the assessee.

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