Section 50D of ITA, 1961 : Section 50D: Fair Market Value Deemed To Be Full Value Of Consideration In Certain Cases

Explanation using Example

Imagine Mr. Sharma transfers a piece of antique jewelry, a family heirloom, to his friend without any formal agreement or payment. Since there is no actual monetary transaction, the consideration for this transfer is not ascertainable. According to Section 50D of the Income-tax Act, 1961, for tax purposes, the fair market value of the jewelry on the date of the transfer will be considered as the sale consideration for calculating capital gains tax that Mr. Sharma may have to pay.