2018 (8) TMI 1319

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....11-12. Shri Gunjan Pathak, learned counsel for the appellant-assessee has argued that the learned ITAT has erred in law in confirming the order of CIT(A) in considering the division of the huge chunk of 10-11 bigha agricultural land into smaller portions of agricultural land for easy viability and sale as income from business and profession instead of income under the head capital gains, even when the appellant had inherited the land from his forefathers and had no intention or a previous track record of being into the business of purchase and sale of properties. It is contended that the learned ITAT has erred in confirming the receipt sale of agricultural land as income from business and profession, whereas the appellant had subdivid....

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....is share of agricultural land into 34 residential plots and sold them to various purchasers as residential plots and stamp duty has also been paid on conveyance deed so executed and further that the plot size ranges from 900 sq. ft. to 2964 sq. ft. of the individual residential plots of lands and that the development of course took place about 12 months ago. The Tribunal has also taken note of the findings recorded by the Assessing Officer that assessee has developed agricultural land into 34 small plots, developed access road within the plotted land and sold to individual purchasers as residential plots over a period of three years. As per assessee's own submissions dated 23.3.2015, it has been stated by the assessee before the AO that "th....

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.... has developed residential plots and then sold it to individual buyers. The findings recorded by the AO that by such plotting of land, the agriculture land has been converted into stock-in-trade of assessee's business, was thus upheld by the CIT(A) and affirmed by the ITAT. The development of residential colony and said conversion has happened by the assessee's own admission during financial year 2009. The fair market value of the asset on the date of conversion as reduced by the cost of acquisition is required to be assessed under the head "capital gain" in the year the stock-intrade is sold/transferred. The sales realization of the stock-intrade over such fair market value is required to be assessed as "business income". During the yea....