Sec 43CA of income tax applicablity

[Guest]

Dear Sir

I had applied for a site in Bangalore in the year 2006 and paid 60% amount to the builder by way of Demand Draft.

There was an agreement between our Bank Employees Union who is a felicitator between the Builder and me. The builder issued me an allotment/ offer letter in tis effect

The agreed rate was ₹ 560/- per sft. The builder got final permission from BMRDA on Oct 2014 and send me a letter stating that the plot is ready for registration and asked me to pay the balance amount of 40%.

Further the builder is demanding an extra amount of ₹ 190/- per sft stating that the Govt of Karnataka has raised the guidance value as ₹ 750/-.

The builder is stating that since new provisions of Sec 43CA is applicable to him and the IT dept will calculate his income at the guidance value [ i.e stamp value for registration].

Is it correct in his demand.

Whether the sec 43CA [Sub section 1,2,3,4] can give any relief for me since there was an agreement before the increase of guidance value and I paid some amount by way of Demand draft.

Please guide me

Regards

V madhusudhan.

[DR.MARIAPPAN GOVINDARAJAN]

The value should be taken at the time of registration. The Act is irrespective of the agreement made between the parties. The property could not be registered below the guidance value.

AI Summary

Guidance value determines the property value at registration, and earlier private agreements do not override it. Guidance value (stamp duty value) governs the taxable and registration value of property at the time of registration irrespective of prior agreements; transactions cannot be registered below the guidance value, and earlier payments or allotment letters do not alter the statutory requirement to use the guidance value for tax and registration purposes.