capital gain

[Guest]

namaskar,

an agrivultural land is sold by dividing it into three parts and as a result three registered deeds were made..is this liable to capital gain.?

[K.S.AIYAR & CO.]

If this land is an agriculture land within meaning of section 2 (14)(iii) of the IT Act, 1961, and continues to remain so even after division in to 3 parts, then there will be no capital gains tax since it will not fall under definition of term Capital Asset u/s 2 (14) of the Act. U/s 45 CG are chargeable on transfer of a Capital Asset only.

[kiran kumar]

where the agricultural land is situated ? is it rural agri land or urban agri land? if rural agri land no capital gain will attract.

AI Summary

Selling Divided Agricultural Land: Exempt from Capital Gains Tax if Classified Under Section 2(14)(iii) of Income Tax Act An individual inquired about the tax implications of selling agricultural land divided into three parts, resulting in three registered deeds. The first respondent clarified that if the land qualifies as agricultural under section 2(14)(iii) of the Income Tax Act, 1961, and remains so post-division, it is not considered a capital asset, thus exempt from capital gains tax. The second respondent asked for the land's location, noting that if it is rural agricultural land, no capital gains tax would apply.