KASHMIRA RAJNIKANT DOSHI ,MUMBAI vs. INCOME TAX OFFICER WARD 42(1)(3), MUMBAI

ITA 728/MUM/2026Status: DisposedITAT Mumbai29 September 2026AY 2018-1919 pages
AI SummaryAllowed

What were the facts?

The assessee, Kashmira Rajnikant Doshi, filed her return of income for Assessment Year 2018-19 on August 31, 2018. The case was selected for scrutiny. The Assessing Officer (AO) noted that the assessee had transferred tenancy rights in a property for a stated consideration. However, the stamp valuation authority adopted a higher value for this transfer. The AO, invoking Section 50C of the Income-tax Act, 1961, proposed to use the stamp duty value as the full value of consideration for computing capital gains. The assessee did not file any submissions in response. Consequently, the AO completed the assessment under Section 143(3) on March 12, 2021, making an addition of Rs. 3,80,800/- as long-term capital gain based on the stamp duty value.

What did the Tribunal hold?

The Tribunal held that Section 50C of the Income-tax Act, 1961, is not applicable to the transfer of tenancy rights. The reasoning was that Section 50C specifically applies to the transfer of 'any interest in any land or building or both'. Tenancy rights, while valuable, are distinct from ownership interest in land or building. The Tribunal noted that the CIT(A) erred in holding that a tenancy right, when transferred for consideration, is 'essentially the sale of a valuable interest in the building itself'. The Tribunal found that the CIT(A)'s order was indeed a non-speaking order as it did not provide adequate reasoning for its conclusions, particularly regarding the applicability of Section 50C to tenancy rights. Therefore, the addition made by the AO and sustained by the CIT(A) was deleted. The issue of referring the matter to the DVO under Section 50C(2) became infructuous due to the non-applicability of Section 50C.

What were the issues?

1. Whether Section 50C of the Income-tax Act, 1961, can be applied to the transfer of tenancy rights, or is it restricted to the transfer of land or building? (Question of law) 2. Whether the order of the learned Commissioner of Income-tax (Appeals) - NFAC is a non-speaking order and deserves to be quashed? (Question of mixed law and fact) Assessee's contentions: - Section 50C is applicable only to the transfer of land or building, and tenancy rights, being intangible assets, fall outside its scope. - In the alternative, if Section 50C were applicable, the matter should have been referred to the Departmental Valuation Officer (DVO) under Section 50C(2). - The CIT(A) passed a non-speaking order without providing reasons, which should be quashed. Revenue's contentions: - The revenue did not explicitly record any contentions in the provided text. However, the AO and CIT(A) proceeded on the basis that Section 50C was applicable to the transfer of tenancy rights.

Which sections of the Income-tax Act were involved?

Section 50C,Section 50C(2),Section 143(3),Section 54EC

AI-generated summary — verify with the full judgment below

Income Tax Appellate Tribunal, MUMBAI BENCHES, MUMBAI

Before: SHRI OM PRAKASH KANT & SHRI ANIKESH BANERJEE

For Appellant: Shri. Ketan Vajani, CA
For Respondent: Shri. Pravin Salunkhe, Sr. DR
Pronounced: 29.09.2026

PER SHRI OM PRAKASH KANT, ACCOUNTANT MEMBER:

This appeal by the assessee is directed against the order dated 13.11.2025 passed by the learned National Faceless Appeals Centre, Delhi [hereinafter referred to as the “learned CIT(A)”] for A.Y. 2018-19, whereby the addition of Rs.3,80,800/- made by the Assessing Officer by invoking section 50C of the Income-tax Act, 1961 (“the Act”) in respect of transfer of tenancy

ITA 728/MUM/2026 KASHMIRA RAJNIKANT DOSHI

rights was sustained. The assessee has raised the followin

The order continues below.

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