TaxTMI 
TaxTMI 
2017 (6) TMI 341
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....re extracted as under : "2. The appellant denies himself liable to be assessed in respect of gains arising from sale of agricultural land amounting to Rs. 58,21,520/- as business income under the facts and circumstances of the case. 3. The learned authorities below are not justified in treating the agricultural land as business asset under the facts and circumstances of the case. 4. The learned authorities ought to have considered the fact that the lands sold are agricultural lands & do not even partake the character of Capital assets u/s.2(14)(iii) of the Act much less Business assets, under the facts and circumstances of the case. 5. The learned authorities below are not justified in applying the ratio adventure in the nature ....
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.... the properties located at Sus Village, Kondhwa Khurd and Hinjewadi, there is no dispute before us. The incomes earned from the related transactions were taxed as Business income. However, with regard to the purchase and sale of transaction of land at Bhivari, the assessee claimed exemption considering the agricultural nature of the lands at Bhivari. The relevant facts are given at pages 5 and 6 of the assessment order which read as under : "Sale of land at Bhivari The assessee has sold agricultural land admeasuring 3.80 R at village Bhivri, Tal. Haveli, Dist. Pune for consideration of Rs. 1,38,75,000/- vide agreement dt. 3-6-2008. This land was purchased on 5-12-2006 for a consideration of Rs. 19,42,500/-. This was purchased jointly ....
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.... to the cultivation of the said land. Eventually, both the owners of the said land decided to sell the lands. Accordingly, the said admeasuring 3.80 R, which was purchased for a sum of Rs. 19,42,500/- excluding commission charges and the same was sold for a sum of Rs. 1,38,75,000/- on 03-06-2008 after holding the land for 18 months. 5. Considering the fact the same is an agricultural land and located beyond 8 kms of the Pune Municipality, the assessee claimed the exemption on the profits (i.e. Rs. 1,36,90,000 - Rs. 20,46,960/- X 1/2). In the assessment, the claim of the assessee was denied and Assessing Officer treated the same as a transaction Adventure in the nature of Trade. Accordingly, his share of income amounting to Rs. 58,21,520/....
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....f such intention is a relevant and crucial factor for determining the particular transaction constitutes an 'Adventure in the nature of Trade'. However, there is no finding of fact by the CIT(A) as to how the purchase and sale of an agricultural land held by the assessee is not exempt despite the provisions of section 2(14)(iii) of the Act relating to Agricultural land in India. Eventually, the CIT(A) confirmed the addition made by the Assessing Officer. 6. Before us, Ld. Counsel for the assessee argued that this is a case of an exempt agricultural land acquired by the assessee along with Shri Tushar Atmaram Kalate purely for agricultural operations, i.e. growing medicinal plants on the principles. In support of the same, Ld. Counsel for....
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.... timing of the purchase. Therefore, it is not a case of 'Adventure in the nature of Trade'. Without prejudice, he also submitted that the agricultural land with recorded agricultural activities in it, on sale, it will never yield the taxable income in view of the exemptions available to the transactions of sale of agricultural land. Ld. Authorised Representative argued that the other co-owner of the land left out by the Revenue without taxing the other 50% of the sale proceeds. In such circumstances, it is the demand of Ld. Authorised Representative that the addition made by the Assessing Officer in the hands of the assessee is not sustainable in law. For this proposition, Ld. Authorised Representative for the assessee relied on Honble' Mad....
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.... to the point of purchase, the 'Adventure in the nature of Trade' does not arise to such transaction. It is relevant to mention that the assessee is engaged in the business activities with his properties located at Sus Village, Kondhwa Khurd, Hinjewadi. The same is undisputed. However, when comes to the property at Bhivari, the assessee retained the said land for a period of 1 ½ years by the time it is eventually sold. During the period, attempts were made to use the land for agricultural activities. However, the said attempts did not yield results. In any case, it is decided proposition of law that the use of land for agricultural activities is not a relevant factor for determining the nature of land as Agricultural in nature. Howev....