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CS Professional · Corporate Restructuring, Valuation and Insolvency · Taxation and Stamp Duty Aspects of Corporate Restructuring

Arjun Realty Pvt Ltd signed an agreement on 1 June to sell a capital-asset building for ₹2,00,00,000. Registration was done on 1 September. It received ₹20,00,000 on 25 May through an account payee cheque and a further sum later. The stamp duty value was ₹2,40,00,000 on 1 June and ₹2,60,00,000 on 1 September. Which stamp duty value can be taken as the full value of consideration under section 78?

The stamp duty value of ₹2,40,00,000 on the agreement date can be taken. Section 78(1)(a) permits this when the agreement and registration dates differ and part consideration was received through specified banking or online mode on or before the agreement date. Both conditions are satisfied here.

  1. A₹2,60,00,000 as on the registration date, since the sale is complete then
  2. B₹2,40,00,000 as on the agreement date, since part consideration was received by specified banking mode on or before the agreement dateCorrect
  3. C₹2,00,00,000 since the 110% tolerance always applies
  4. DEither date at the Assessing Officer's option, regardless of how payment was received

Explanation

Section 78(1)(a) allows the stamp duty value on the date of agreement where the agreement and registration dates differ and part or full consideration was received in specified banking or online mode on or before the agreement date. Both conditions are met. The tolerance does not apply because 2.40 crore exceeds 110% of 2.00 crore (2.20 crore).

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