Land classified as rural, not capital asset, in tax appeal against CIT(A) order.

The appeals were filed against the order of Ld. CIT(A)-2, Chandigarh, with some appeals delayed but condoned due to the Assessee's ill health. The Assessing Officer classified the land as a capital asset, treating agricultural income as capital gain. The Ld. CIT(A) upheld this decision based on the CBDT notification. Additional evidence on land distance was admitted, leading to the tribunal determining the land as rural, deleting the Assessing Officer's addition. The tribunal allowed all appeals, directing the deletion of the addition made by the Assessing Officer.

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Issues:
- Condonation of delay in filing appeals
- Classification of land as agricultural or capital asset
- Treatment of agricultural income as capital gain
- Consideration of evidence regarding land usage and revenue assessment
- Applicability of CBDT notification on land classification
- Admission of additional evidence
- Reliance on assessment orders of other villagers
- Distance of land from National Highway
- Urban or rural classification of land
- Acceptance of returned income in previous years

Condonation of Delay:
The appeals were filed by different assesses against the order of Ld. CIT(A)-2, Chandigarh. Some appeals were delayed, but the delay was condoned due to the ill health of the Assessee. In one case, the legal heir was brought on record.

Classification of Land:
The Assessee sold land to M/s Hamir Real Estate Pvt. Ltd. The Assessing Officer considered the land as a capital asset under Section 2(14)(iii) and CBDT Notification No. 9447. The land was deemed to be within the specified area near Mohali-Kharar Road, making the sale consideration chargeable to capital gains.

Treatment of Agricultural Income:
The Assessing Officer treated the agricultural income as capital gain, concealing income and earning interest without considering the explanations and evidences provided by the Assessee. The Assessee argued that the land was used for agricultural purposes, supported by records like Khasra Girdwari and Jamabandi.

Applicability of CBDT Notification:
The Ld. CIT(A) upheld the Assessing Officer's decision, stating that the land fell within the specified area mentioned in the CBDT notification, making it a capital asset. The Assessee's arguments regarding population and land revenue assessment were deemed irrelevant as per the notification.

Admission of Additional Evidence:
Additional evidence regarding the distance of the land from National Highway was admitted by the tribunal to ensure substantial justice and proper adjudication of the issue.

Reliance on Assessment Orders:
The Assessee argued against the Assessing Officer's reliance on assessment orders of other villagers without proper verification. The tribunal considered the Tehsildar's report certifying the distance of the land from the National Highway.

Urban or Rural Classification:
After due enquiries, it was established that the land was rural and outside the municipal limits, beyond the specified distance from the National Highway. The tribunal directed the deletion of the addition made by the Assessing Officer based on the evidence provided.

Acceptance of Returned Income:
Considering the acceptance of the distance by the Revenue in previous years and the evidence from Land Revenue Authorities, the tribunal allowed all the appeals of the Assessee, directing the deletion of the addition made by the Assessing Officer.

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