Sir,
I am a govt. servant. I am paying income tax and filed income tax return.
I have a ancestral agricultural land in rural area which is 1o km far from manciple area. In the year 2009 I sold a piece of this land sum of Rs. 16.3 Lakh. In this regard, I have to need to some quarry.
Whether I have to pay income tax on this sale? or exempted?
Whether I have to show this amount in income tax return?
If I have to pay income tax, up to what amount?
It is, therefore, requested that kindly inform me.
Thank u very much.
KS ADHIKARI
Government Employee's Ancestral Land Sale Not Taxable as Capital Gains Under Section 2(14) Income Tax Act, 1961 A government employee sought advice on whether the sale of ancestral agricultural land, located 10 km from a municipal area, is subject to income tax. Two responses clarified that rural agricultural land is not considered a capital asset under Section 2(14) of the Income Tax Act, 1961, and thus, the sale is not taxable as capital gains. However, it was advised to establish the land's agricultural use and ensure it wasn't being developed for sale, which could lead to it being taxed as business income. If taxed, the income should be reported under exempted incomes. (AI Summary)
TaxTMI 
TaxTMI 
