TaxTMI 
TaxTMI 
TaxTMI 
1985 (4) TMI 42
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....easuring 2,250 sq. yards each. Yaswant Singh made a gift of 450 sq. yards of land by registered gift deed dated June 3, 1969, to Geeta, wife of his younger brother, Mahendra Singh. Mahendra Singh also made a gift of about 749 sq. yards each, to Sushila Devi, wife of Yaswant Singh, and Pradyuman Singh, minor son of Yaswant Singh, by a registered gift deed dated July 29, 1969. On August 2, 1969, Yaswant Singh, Mahendra Singh and Sushila Devi sold the aforesaid land owned by them to M/s. Balkishan Commercial Company of Calcutta by separate sale deeds. While Yaswant Singh sold his land at Rs. 45 per sq. yard, Mahendra Singh sold his land at Rs. 55 per sq. yard and Sushila Devi sold the land belonging to her at Rs. 40 per sq. yard. Pradyuman Singh also sold his land to M/s. Balkishan Commercial Company by a registered sale deed dated April 9, 1970, at Rs. 40 per sq. yard. Yaswant Singh, Mahendra Singh, Sushila Devi and Pradyuman Singh disclosed capital gains made by them as a result of the aforesaid transactions of sale in their returns pertaining to the assessment year 1970-71. The ITO, in the course of assessment proceedings, felt that the assessees had sold their lands at a very low....
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....t business and commercial centre at Jaipur, but the lands in question were situated on a 20' wide road, known as Sansar Chandra Road, off Mirza Ismail Road. As such, the Tribunal held that the value of the plots of land situated on the Mirza Ismail Road, whether on sale or mortgage, did not reflect the prevailing market rate in respect of the lands in question, which were situated on Sansar Chandra Road, because the lands in question could not be considered to be similarly situated to the instances of sale and mortgage relied upon on behalf of the Revenue. The Tribunal also rejected the seven instances relating to transactions of sale relied upon by the assessees on the ground that six sales out of them related to small plots of land. The Tribunal held that the assessees have failed to prove that the seven instances relied upon by them were comparable instances of sale of lands in the locality. Thus, the Tribunal came to the conclusion that there was no satisfactory evidence on record to prove that the consideration specified in the sale deeds executed by the assessees did not represent the fair market value of the lands sold. The Tribunal, therefore, dismissed the appeals filed by....
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....r section 45, the full value of the consideration for the transfer shall, with the previous approval of the Inspecting Assistant Commissioner, be taken to be the fair market value of the capital asset on the date of the transfer. (2) Without prejudice to the provisions of sub-section (1), if in the opinion of the Income-tax Officer the fair market value of a capital asset transferred by an assessee as on the date of the transfer exceeds the full value of the consideration declared by the assessee in respect of the transfer of such capital asset by an amount of not less than fifteen per cent. of the value so declared, the full value of the consideration for such capital asset shall, with the previous approval of the Inspecting Assistant Commissioner, be taken to be its fair market value on the date of its transfer. " The provisions of s. 52(1) enable the computation of capital gains arising out of a transfer of a capital asset with reference to its fair market value as on the date of transfer ignoring the amount of consideration shown by the assessee if the following two conditions are satisfied : (1) The transferee should be a person who is directly or indirectly connected with ....
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....consideration for the transfer has been understated or the consideration actually received by the assessee is more than what has been declared or disclosed by him or there has been concealment of consideration, then sub-s. (2) is immediately attracted, subject to the condition that the difference between the consideration disclosed in respect of the transfer of the capital asset and the fair market value thereof on the date of the transfer is more than 15%. Their Lordships proceeded to observe as under in K. P. Varghese's case : " There are two distinct conditions which have to be satisfied before sub-s. (2) can be invoked by the revenue and the burden of showing that these two conditions are satisfied rests on the revenue. It is for the revenue to show that each of these two conditions is satisfied and the revenue cannot claim to have discharged this burden which lies upon it, by merely establishing that the fair market value of the capital asset as on the date of the transfer exceeds by 15% or more the full value of the consideration declared in respect of the transfer and the first condition is, therefore, satisfied. The revenue must go further and prove that the second conditi....
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....h deals with 'Taxes on income other than agricultural income' and under which the I.T. Act, 1961, has been enacted, Parliament cannot ' choose to tax as income an item which in no rational sense can be regarded as a citizen's income or even receipt. Sub-section (2) would, therefore, on the construction of the revenue, go outside the legislative power of Parliament and it would not be possible to justify it even as an incidental or ancillary provision or a provision intended to prevent evasion of tax '." Thus it has been firmly established by the aforesaid decision of their Lordships of the Supreme Court that sub-s. (2) of s. 52 cannot be invoked only where the consideration disclosed for the transfer was less than the fair market value of the capital asset transferred by more than 15%, unless it is shown that the consideration for the transfer has been understated by the assessee or that the consideration actually received by the assessee is more than what is disclosed or declared by him and the burden of proving the concealment or the understatement is on the revenue. In the present case, the Tribunal has found as a fact that it has not been stated, on behalf of the Revenue that ....