Land sale profit treated as investment realisation, not business income, where facts showed no trading adventure.

Profit on sale of a plot of land was treated as investment realisation rather than income from an adventure in the nature of trade, because the surrounding facts showed no further land dealings, no development activity, no trading organisation, and no trading experience beyond salaried employment. The analysis emphasised that the character of a land transaction must be judged from the totality of circumstances, and that the department bears the burden of proving a trading venture. The receipt was therefore not assessable as business income, though it could still be examined under any other lawful head of income if applicable.

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Issues: Whether the profit arising from the sale of a plot of land was assessable as income from an adventure in the nature of trade or as a mere realisation of investment.

Analysis: The character of a land transaction must be determined from the totality of circumstances and not from isolated factors. The burden lies on the department to establish that the transaction was a trading adventure. Relevant surrounding circumstances, including the absence of any further land transactions, absence of development activity, absence of trading organisation, and the fact that the assessee was a salaried employee without trading experience, pointed away from a business venture. On those facts, the transaction was treated as investment realisation. The order also clarified that, while the amount could not be assessed under the head business, it could still be examined under some other lawful head of income, if applicable.

Conclusion: The receipt was not taxable as business income from an adventure in the nature of trade and the issue was decided in favour of the assessee.

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