Section 43CA does not apply to transfer of TDRs, so stamp duty value cannot replace the stated sale consideration.

Section 43CA applies only to transfer of land or building, or both, held as stock-in-trade, and its deeming fiction cannot be extended beyond that statutory scope. Transferable development rights are development rights and not land or building per se, so their transfer is distinct from transfer of immovable property covered by the provision. On that reasoning, stamp duty value could not be substituted for the stated sale consideration on transfer of TDRs, and the addition was not sustainable in law.

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Issues: Whether section 43CA of the Income-tax Act, 1961 applies to transfer of transferable development rights (TDRs) and justifies substitution of stamp duty value for the stated sale consideration.

Analysis: Section 43CA applies to transfer of an asset being land or building or both held as stock-in-trade. TDR is a development right and not land or building per se. Deeming provisions cannot be extended beyond the purpose for which they were enacted. The transfer of TDRs is distinct from transfer of land or building, and the provision cannot be invoked merely because the rights are connected with immovable property.

Conclusion: Section 43CA does not apply to transfer of TDRs. The addition made by substituting the stamp duty value was not sustainable, and the deletion of the addition was in law.

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