Stamp Duty Value Provisions for Immovable Property: Who Is Taxed Under Which Section

This article explains the three provisions that deem stamp duty value (SDV) to be the relevant figure when land or a building changes hands for a different price, and identifies the person each provision taxes: Section 50C, Section 43CA and Section 56(2)(x) of the Income-tax Act, 1961, together with their counterparts in the Income-tax Act, 2025.

The 2025 Act took effect from 1 April 2026 and re-numbers these provisions, while the 1961 Act continues for earlier years. Every transaction therefore needs a first check on the governing Act before any section number is applied, and the three provisions need to be kept apart because they tax different persons under different heads.

Which Act applies

The Income-tax Department's position is that the 2025 Act applies for Tax Year 2026-27, while Assessment Year 2026-27 continues under the 1961 Act. The mapping is:

• Section 50C of the 1961 Act corresponds to Section 78 of the 2025 Act.
• Section 43CA corresponds to Section 53.
• Section 56(2)(x) corresponds to Section 92(2)(m).

The exact conditions and exceptions should be read from the Act that governs the year in question. This article states the general scheme and does not replace that check.

Questions practitioners ask

Which provision applies to the seller of a capital asset?

Section 50C applies to the transferor where land or building, or both, is a capital asset transferred for a consideration lower than the value adopted, assessed or assessable by the stamp valuation authority. The SDV is deemed to be the full value of consideration, and capital gains are computed as that deemed value less the eligible deductions.

The deemed value is a computation rule. It does not mean the seller actually received that amount.

What if the seller holds the property as stock-in-trade?