The house has been gifted by Mr. Kumar to his friend Mr. Sharma. So, there is no question of taxing the value of building in the hands of Mr. Kumar because the question of tax implications of gift arises when gift is received by an individual/HUF and not when the gift is given by the individual/HUF. Thus, in this case the taxability will arise in the hands of Mr. Sharma who is the receiver who has received the building without adequate consideration. The stamp duty value of the property exceeds the purchase price by an amount exceeding Rs. 50,000 i.e. by Rs. 21,00,000 (the value adopted to charge stamp duty less consideration paid). Thus, Rs. 21,00,000 will be taxed in the hands of Mr. Sharma and not in the hands of Mr. Kumar.
