Real estate experts have long been questioning the manner in which the state town planning and valuation department values a property.
In one of the clearest signs of the system requiring an overhaul, the property cell of the income tax department recently revised the value of a property, calculations of which were based on the state ready reckoner rates, from Rs25 crore (almost 800% more than the sale agreement value of Rs1.26 crore) to Rs3 crore. The land owner, Thomas Ferreira has now been asked to pay capital gains tax on the new value of Rs3 crore.
In 2005, Ferreira and five other co-owners sold a 35,000 sq mt plot at Shankar lane in Malad (W) to a developer for Rs1.26 crore. The sale agreement was registered and the developer, being the buyer, paid a stamp duty of Rs25 lakh. Being the seller, Ferreira paid capital gains tax as stipulated under I-T rules in 2006.
More : dnaindia.com
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