2010 (9) TMI 560

X X   X X   Extracts   X X   X X

Full Text of the Document

X X   X X   Extracts   X X   X X

....land. On September 3, 1990 they sold the said land to Varca Holiday Beach Resort Private Limited for a sum of Rs. 73,00,000 and the consideration was paid equally to the wife and husband. The respondents filed separate returns of income under the Income-tax Act. The capital gainarising out of the sale of the land was claimed by each of them to be exempt, being arising out of the sale of agri-cultural land. The Assessing Officer held that the said land had non-agricultural potential and the fact that it was sold at a price which was nearly 10 times the purchase price within two years from its purchase and it was purchased by the purchaser for the purpose of a beach resort showed that the said land was not an agricultural land. Consequently, ....

X X   X X   Extracts   X X   X X

Full Text of the Document

X X   X X   Extracts   X X   X X

....ling it for a non-agricultural use. The huge difference in the price nearly 10 times the purchase price would indicate that the land was purchased with an eye on the non-agricultural potential. The learned counsel for the appellant, therefore, submitted that the said land was not an agricultural land. The learned counsel for the appellant also invited our attention to the fact that the respondents had not shown any agricultural income during the period of two years from the date of the purchase till the date of the sale, arising out of the said land. This also showed that the land was not an agricultural land. The counsel for the appellant submitted that the Commissioner of Income-tax (Appeals) as well as the Income-tax Appellate Tribunal c....

X X   X X   Extracts   X X   X X

Full Text of the Document

X X   X X   Extracts   X X   X X

....me derived by sale of the coconuts was just enough to maintain the land and there was no actual surplus. Hence, no agricultural income was shown from this land. In our opinion, if an agricultural operation does not result in generation of surplus that cannot be a ground to say that the land was not used for the agricultural purpose. It is not disputed that the land was shown in the revenue record to be used for agricultural purpose and no permission was ever obtained for non-agricultural use by the respondents. Section 30 of the Goa, Daman and Diu Land Revenue Code, 1968, provides that no land used for agriculture shall be used for any non-agricultural purpose and no land assessed for one non-agricultural purpose shall be used for any other....