TaxTMI 
TaxTMI 
2017 (2) TMI 231
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....red in upholding the change of head of income' by the AO treating the declared Income from Long term Capital Gains as Income from Business. 3. The Ld. CIT(A) has erred in upholding the order of AO in treating the income from sale of plots as Business Income as against declared as Income from Capital Gains and thereby making an addition of Rs. 11,69,344 under the head Business income as against Rs. 96,485 declared by the appellant as Income from Long Term Capital gains. 4. The Ld CIT(A) has erred in upholding the order of AO in disallowing Rs. 1,21,832 from the development expenses @ 20% of Rs. 609158. 5. The order of the A.O. is against law and facts of the case. 6. The appellant craves the right to add, amend or withdraw any gr....
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....1,92,607/- on the whole land. But in this year the assessee claimed the expenses on development of land at Rs. 9,19,500/-. After examination it is found that the assessee has made expenses on this account at Rs. 6,09,158/-. These expenses are not fully vouched therefore 20% of these expenses i.e. Rs. 1,21,832/- are hereby disallowed. Hence, an addition of Rs. 1,21,832/- is made to the returned income of the assessee. (Addition Rs. 1,21,832/-) The agricultural land was got converted to other than agricultural land mentioned in para 3 above and area chart forming past of valuation report filed by the assessee bearing date 05.04.2010 is annexed to this order as annexure "A". The cost of land is taken by indexing the rate of 1981-82. After ....
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....head "business income". The fact that it was the ancestral land inherited by the assessee for the last more than 29 years and the assessee is not involved in any business activity of real estate business and this was the first time that agricultural land was sold it was submitted have been ignored. These written submissions it was submitted are extracted at page 5 of the CIT(A)'s order. Considering these, the CIT(A) at page 7 though notes the argument of the assessee, however rejects the claim taking the following facts into consideration:- "In the case of the appellant the land was purchased for business purposes. The appellant waited for the correct time to develop it and then sold the land after dividing it in plots. There is no con....
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....erted in urban land under sec 143 of the Zamindari Vinash Adhinium. In fact the land which are in municipal limits and in case any person wants to sell such type of agricultural land it is mandatory to convert such type of agricultural land into urban land. Assessee has converted this land due to this legal implication in this case." 6.1. It is seen that it has been argued that for making the sale feasible the assessee has borne the expenses for plotting and making the roads etc. Payments for which necessarily were made to labourers and the material sourced was again local material sourced from the unorganised sector wherein necessarily the expenditure vouched would again be hand vouched. In the absence of any abnormal claim vis-à-....