Apart from taxing immovable property received without consideration, i.e., received as gift, the Income-tax Law has also designed the provisions for taxing immovable property received for less than its stamp duty value. If following conditions are satisfied, then immovable property received by an individual or HUF for less than its stamp duty value will be charged to tax (*):
Any immovable property is acquired by an individual or a HUF.
The immovable property is a 'capital asset' within the meaning of section 2(14)of the Act for such individual or HUF.
Such property is acquired for a consideration but the consideration is less than the stamp duty value and the difference exceeds Rs. 50,000.
In above case the excess of stamp duty value over the purchase price of the property will be treated as income of the purchaser.
(*) Refer next FAQ for situations in which value of immovable property received for less then its stamp duty value is not charged to tax.