The assessee has entered into agreement to sale of its factory line and building on 14–8‑2007 wherein consideration of Rs. 27.62 crores was decided and assessee received a sum of Rs.14.39 crore by cheque at the signing of the agreement. However, agreement to sale was registered on 29–4‑2009. The AO proposed to take valuation of property as on the date of registration 29–4‑2009 and thereafter, as per the request of the assessee matter was referred to the DVO. The issue was whether valuation to be taken as on the date of entering into agreement or as on the date when the sale deed is actually registered. The CIT(A) held that the fair market value of the property is to be taken on date of agreement to sale i.e. 14–8‑2007.
The Tribunal observed that at the time of entering into agreement to sale , the assessee has already received more than 50% amount of the agreement value and due to certain conditions, the sale deed could not be registered and finally, it was registered only on 29–4‑2009. The Tribunal held that when agreement to sale is executed between the parties and part consideration is received, approval of the authorities of S. 50C takes place, computation u/s. 48 will start accordingly. Therefore, provisions of S. 50C is applicable as on the date of execution of the agreement to sale.
Held in the case of ACIT v. M/s. Balmer Lawrie Van Leer Ltd., ITA No.4361I Mum/2016, dt.20/11/2018 (Mum.)(Trib.)