TaxTMI 
TaxTMI 
2013 (7) TMI 165
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....000/-. The assessee's share was 38 guntas and the net capital gain worked out to Rs. 72,04,540/-. This was claimed to be exempt being agricultural land. The AO disagreeing with the claim of the assessee added back this amount. The AO also disagreed with similar exemption claimed at Chengicherla Village, amounting to Rs. 1,04,950/- and added back this amount. 3. Aggrieved the assessee carried the matter in appeal before the CIT(A). 4. The CIT(A) noted that the assessee did not provide any evidence to show that the land in question was situated beyond 8 kms of the municipal limits and held as under:- "5.3 I have considered carefully the facts and evidences and I find that the AO has duly verified the location of the lands and it is clear t....
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....pality. 5. The learned CIT(A) erred in confirming the action of the AO in rejecting the claim of the appellant that the agricultural lands sold are not the capital assets and further erred in confirming the determination of the capital gains. 6. The learned CIT(A) erred in confirming the addition of Rs. 14,000/- made by the AO on account of difference in the sale consideration." 7. We have heard the arguments of both the parties and perused the record. The grievance of the assessee is that the sale of subject land being agricultural does not constitute a transfer of capital asset for being taxed in the head capital gain when the land is not a capital asset either within the meaning of section 2(14)(iii)(a) or 2(14)(iii)(b). We find that ....
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....sold were in the possession of the assessee, who was carrying on agricultural operations on the same. He also submitted that the assessee has also filed before the assessing officer, an affidavit of the Village Revenue Officer, who mentioned that due to pressure of work, he had not filled in the column of 'cultivation' in the Pahani Patrika. The assessing officer did not give due weightage to this valuable piece of evidence, and proceeded to determine the lands in question as of non-agricultural nature. He also disputed the conclusion of the assessing officer in denying the assessee the relief under S.54B on the ground that payment of advances for purchase of land would not entitle the assessee to relief under S.54B, and submitted that the ....
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.... He submitted that if the property is within the specified area of 8 KMs of any municipality, not necessarily within the jurisdiction of the Revenue authority, the property assumes the character of urban land. He placed reliance on the unreported decision dated 1.3.2011 of the Hon'ble Punjab and Haryana High Court in the case of CIT V/s. Smt. Anjana Sehgal (Income-tax Appeal No.276 of 2004), duly filing a copy thereof before us, in support of this proposition. He also submitted that mere payment of advances for purchase of lands, would not entitle the assessee to relief under S.54B of the Act, and what is required to be complied with to fulfil the conditions prescribed under S.54B is the actual purchase of the agricultural lands within the ....
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....ipal Corporation. In similar circumstances, the jurisdictional High Court in the case of CIT vs. Bola Ramaiah (174 ITR 154) held that the capital gains arising out of sale of land situated within 8 KM of local limits of Hyderabad Municipality, is liable for tax on capital gains irrespective of the fact whether it falls under the limits of Rajendra Nagar Mandal or otherwise. Further, mere fact that the land in question was agricultural land cannot be a ground to claim for exemption under section 2(14) of the Act as the land is situated within the local limits of Hyderabad Municipal Corporation. Further, it was held recently by the Hon'ble Punjab & Haryana High Court in the case of CIT vs. Smt. Anjana Sehgal (supra) that the expression "from ....
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....ely whole transaction of purchase of land was completed within a period of two years as contemplated under S.54B of the Act, assessee is entitled for relief under S.54B of the Act. In this view of the matter, we set aside the orders of the lower authorities, and restore this issue to the file of the assessing officer for verifying whether the assessee has purchased the agricultural lands within a period of two years, so as to qualify for relief under S.54B of the Act, and accordingly re-decide this issue in accordance with law and after giving reasonable opportunity of hearing to the assessee. Grounds of the assessee on this issue are allowed for statistical purpose." 8. The CIT(A) while confirming the addition made by the AO noted that th....