Per Chandra Poojari, Accountant Member. : This appeal by assessee is directed against order of CIT(A), Bhatinda, dated 10-9-2007. 2. assessee agitated ground that ld. CIT(A) has erred in sustaining addition made by Assessing Officer on wrong application of section 50C of Income-tax Act, 1961. brief facts of case are that assessee has sold land, building and machinery in assessment year under consideration. capital gain attributable to sale of land is subject-matter of dispute before us. assessee sold land situated at Bhatinda. assessee registered property at Rs. 220.81 per sq. yd. for consideration of Rs. 16.34 lakhs. According to Assessing Officer, value is applicable to land as per Punjab State Rules dated 20-9-2006 is Rs. 500 per sq. yd. Accordingly, Assessing Officer invoked provisions of section 50C of Income-tax Act, 1961 and referred matter to DVO and got valuation from DVO at Rs. 72 lakhs and after taking indexed cost of acquisition of land at Rs. 9.60 lakhs, determined capital gain at Rs. 62.40 lakhs. 3. Aggrieved, assessee in appeal before CIT(A) and ld. CIT(A) confirmed order of Assessing Officer. Further aggrieved, assessee in appeal before us. 4. We have heard both parties and perused material on record. Relevant paragraph of section 50C reads as under:-50C Special provision for full value of consideration in certain cases.-(1) Where consideration received or accruing as result of transfer by assessee of capital asset, being land or building or both, is less than value adopted or assessed by any authority of State Government (hereinafter in this section referred to as 'Stamp valuation authority') for purpose of payment of stamp duty in respect of such transfer, value so adopted or assessed shall, for purposes of section 48, be deemed to be full value of consideration received or accruing as result of such transfer. It is observed that section 50C by Finance Act, 2002 came into force with effect from 1st April, 2003. Clause 24 of Finance Bill as per Notes on Clauses states that insertion of this provision is to provide for special provision for full value of consideration in certain cases. It has been provided that where consideration received or accruing as result of transfer by assessee of capital asset, being land and building or both, is less than value adopted or assessed by any authority of State Government (hereafter in this section referred to as 'stamp valuation authority') for purpose of payment of stamp duty in respect of such transfer, value so adopted or assessed shall, for purposes of section 48, be deemed to be full value of consideration received or accruing as result of such transfer. Memorandum Explaining Provisions of Finance Bill, 2002, states in this regard as under: 'The Bill proposes to insert new section 50C in Act to make special provision for determining full value of consideration in cases of transfer of immovable property. It is proposed to provide that where consideration declared to be received or accruing as result of transfer of land or building or both, is less than value adopted or assessed by any authority of State Government for purpose of payment of stamp duty in respect of such transfer, value so adopted or assessed shall be deemed to be full value of consideration and capital gains shall be computed accordingly under section 48 of Income-tax Act. It is further proposed to provide that where assessee claims that value adopted or assessed for stamp duty purposes exceeds fair market value of property as on date of transfer and he has not disputed value s o adopted or assessed in any appeal or revision or reference before any authority or Court Assessing Officer may refer valuation of relevant asset to Valuation Officer in accordance with section 55A of Income-tax Act. If fair market value determined by Valuation Officer is less than value adopted for stamp duty purposes, Assessing Officer may take such fair market value to be full value of consideration. However, if fair market value determined by Valuation Officer is more than value adopted or assessed for stamp duty purposes, Assessing Officer shall not adopt such fair market value and will take full value of consideration to be value adopted or assessed for stamp duty purposes. It is also proposed to provide that if value adopted or assessed for stamp duty purposes is revised in any appeal, revision or reference, assessment made shall be amended to recompute capital gains by taking revised value as full value of consideration. These amendments will take effect from 1-4-2003, and will, accordingly, apply in relation to assessment year 2003-04 and subsequent years.' From perusal of Notes on Clauses and Memorandum Explaining Provisions in Finance Bill, 2002, it becomes explicitly clear that if consideration declared to be received on sale of land or building or both is less than value adopted or assessed by any authority of State Government for purposes of stamp duty in respect of such transfer, value so adopted or assessed shall be deemed to be full value of consideration and capital gain shall be computed accordingly under section 48 of Act.' In present case, property registered at Rs. 16.34 lakhs at rate of Rs. 220.81 per sq. yd. contention of Department is that value of land is at Rs. 500 per sq. yd., since there is difference, section 50C is applicable. In our opinion, argument of Department is misconceived. Section 50C comes into play only when there is valuation at higher value for stamp valuation purposes by State Authority than declared by assessee in sale deed. When there is such difference noticed, valuation adopted by stamp valuation authority has to be substituted with sale consideration of such property mentioned in sale deed. In present case, property registered at particular rate, which is adopted for registration purpose and there is no question of replacing valuation adopted by stamp valuation authority with DVO for purpose of computing capital gain. purpose of section 50C is that property, which is under transfer from assessee to another person, should have been assessed at higher value for stamp valuation purpose than that received by assessee. Since stamp valuation authority had accepted consideration declared by assessee in sale deed, there is no question of once again referring matter to DVO. Accordingly, we allow ground taken by assessee. 5. In result, appeal of assessee is allowed. *** PUNJAB POLY JUTE CORPORATION v. ASSISTANT COMMISSIONER OF INCOME TAX