Market value

You can refer to Sec 50C of Income Tax Act, 1961.

Further, You would have to pay capital gain on the property and purchaser would be liable to deduct TDS on the amount payable to you.

You can also claim deductions u/s 54, 54F, 54EC.

You can sell the property less than the market value. But if you sell the property less than the Jantri Value then for tax purpose only Jantri value will be deemed as sale consideration and you have to pay tax accordingly as per sec.50C.

Yes you can sell your property and I presume market value referred in your query is value under stamp duty Act. It is O K with tax office, but you will have to pay capital gain tax on difference between market value and indexed cost of acquisition which will be higher by difference between market value and consideration received by you.

As per Income tax act, Sale proceeds will be considered as :

1.Sale consideration received or

2.Stamp duty value

whichever is higher.

You can sell your property but if the sale value is less than the registration value, then the stamp value will be deemed to be your sale value and capital gains will be accordingly arrived at u/s 50C of the Income Tax Act.

As you are a NRI, the buyer of your property will also have to deduct tax on the sale price payable to you u/s 195 of the Income Tax Act.

You can repatriate your sale proceeds only after payment of tax, which has to be certified by a Chartered Accountant.

Dear Tax Payer,

As per Section 50C (1) "Where the consideration received or accruing as a result of the transfer by an assessee of a capital asset, being land or building or both, is less than the value adopted or assessed or assessable by any authority of a State Government (hereafter in this section referred to as the "stamp valuation authority") for the purpose of payment of stamp duty in respect of such transfer, the value so adopted or assessed or assessable shall, for the purposes of section 48, be deemed to be the full value of the consideration received or accruing as a result of such transfer".

In nutshell, value adopted by the stamp valuation authority or actual consideration received whichever is higher has to be considered as 'consideration'. Accordingly, the Capital Gain has to be paid based on the above determined 'consideration'.

Capital Gain= Value adopted by Stamp Valuation Authority/Actual consideration whichever is higher Less Cost/Indexed Cost of Acquisition.

Please note that provisions of Section 50C are not applicable with respect to sale of land where plots of land were held by Assessee as stock in trade and not as Capital Asset. {CIT Vs. Kan Constructions and Colonizers (P) Ltd. (All.)}.

Regards,

CA. Rajeev P T

Partner

Rajan Chakravarthy & Associates, Chennai

Email: ca.rajeevpt@gmail.com

*****This Opinion is based on stated facts and the legal position as on date. The views expressed may not be relevant where there is any change in facts or law. This Opinion is not in the nature of an assurance that an alternative view or interpretation cannot emerge.