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

Pooja Holdings transfers a building held as a capital asset for Rs 80,00,000. The stamp duty value is Rs 1,00,00,000. Pooja claims the fair market value on the transfer date is only Rs 85,00,000, and the stamp duty value is not disputed in any appeal, revision or other forum. The Assessing Officer refers the matter to a Valuation Officer, who determines Rs 1,05,00,000. What is the full value of consideration?

The full value of consideration is Rs 1,00,00,000, the stamp duty value. Where the Valuation Officer's value on a reference exceeds the stamp duty value, the stamp duty value itself is taken as the full value of consideration, so the higher valuation is not used.

  1. ARs 80,00,000, the actual consideration
  2. BRs 85,00,000, the value claimed by Pooja
  3. CRs 1,05,00,000, the Valuation Officer's value
  4. DRs 1,00,00,000, the stamp duty valueCorrect

Explanation

Stamp duty value Rs 1,00,00,000 exceeds 110% of Rs 80,00,000 (Rs 88,00,000), so it is the base value. On a valid reference, if the Valuation Officer's value exceeds the stamp duty value, the stamp duty value is taken as the full value of consideration, not the higher figure. So Rs 1,05,00,000 is wrong.

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