Declared sale consideration for capital gains could not be substituted with higher market value absent evidence of tax avoidance.

The transfer of immovable property for capital gains purposes turned on whether the declared sale consideration could be replaced by a higher fair market value. The Tribunal noted that the assessee sold land with a building for the stated price, and the record did not show that the transaction was structured to avoid or reduce capital gains tax. Relying on the earlier precedent cited by the assessee, it accepted the declared consideration and held that substitution of a higher value was not justified.

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Issues: Whether the Income-tax Officer was justified in substituting the declared sale consideration with a higher fair market value for computing capital gains on the transfer of immovable property.

Analysis: The assessee sold land with a building for a stated consideration, while the department sought to adopt a higher value on the footing that the stated price did not reflect the real consideration. The appellate authority accepted the declared consideration, and the Tribunal found that the record did not contain material to show that the transfer was effected with the object of avoiding or reducing capital gains liability. The earlier decision relied upon by the assessee governed the matter.

Conclusion: The substitution of the declared consideration was not justified, and the assessee succeeded on the issue.

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