TaxTMI 
TaxTMI 
An Individual is having Non Agricultural Land ( measuring 10 acres)for holding more than 3years. If he sells the Land property, How can we treat the Gain amount whether it comes under Business income or Long Term Capital Gain.
Long term capital Gain
08 Jan 2014 
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Long term capital gain treatment may apply to land sale unless the seller is engaged in land trading, determined by circumstances.
Sale of non agricultural land is ordinarily classified as Long Term Capital Gain where the seller is not engaged in the business of dealing in land; if the seller is in the business of land trading, proceeds are treated as Business Income. The characterisation depends on surrounding circumstances and transactional history rather than the holding period alone, and a solitary sale absent other indicia of trading may be treated as capital gain even if held for a shorter period. (AI Summary)
Sale of non agricultural land is ordinarily classified as Long Term Capital Gain where the seller is not engaged in the business of dealing in land; if the seller is in the business of land trading, proceeds are treated as Business Income. The characterisation depends on surrounding circumstances and transactional history rather than the holding period alone, and a solitary sale absent other indicia of trading may be treated as capital gain even if held for a shorter period. (AI Summary)