2019 (4) TMI 776

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....owners of their ancestral agricultural land situated away from the notified area at Village Ibrahimpur Jundepur urf Maujpur, Tehsil Khurja wherein the assessee had 1/3rd share thereof, sold the same on 20.6.2008 and received a sum of Rs. 4,10,500/- as a part of the sale consideration through cheque drawn on HDFC Bank, Branch Khurja. 3. On AIR information about the cash deposit of Rs. 20,07,000/- in SB A/c No.08652151003922 in Oriental Bank of India, Khurja Distt. During the Finance Year 2008-09, ld. AO issued notice u/s 148. Subsequently, further information was received by the learned AO through AIR that the assessee had sold land and received Rs. 3,93,97,000/- . 4. Assessee submitted that he had been earning income from property dea....

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....ltural income of Rs. 41,000/- and the agricultural income of Rs. 41,000/- was accepted by the learned AO by order dated 22.3.2013 u/s 143(3) of the Income-tax Act, 1961 ("the Act"). 7. Learned AO in the remand report, however, further stated that in order to ascertain the nature of land, he deputed an inspector for verification and the report of the inspector is to the effect that the said land was not an agricultural land on the date of inspection and as per the sale deed, the same was sold by the assessee in the shape of industrial plot to M/s Arshia Northern Logistics Infrastructure Ltd. and along withShri Joginder Singh and Mrs. Saraswati Devi. 8. Assessee filed a rejoinder dated 26.3.2015 reiterating that the land that was sold w....

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.... was not liable for capital gains. 10. Revenue is, therefore, in this appeal before us stating that the Sub Registrar in the sale deed at pages 93 to 97 had mentioned that the plot is in the vicinity of industrial area as per Master Plan of Khurja Development Authority. It is further stated that no agricultural activity on the land was taking place and the entire area inclusive of the assessee's land was notified under the industrial area of the Master Plan of Khurja Development Authority as notified area. According to the Revenue, there is no basis for the learned CIT(A) to treat the land as an agricultural land inasmuch as the land is in the notified area and as per Section 2(14)(iii)(a) of the Act, the provisions of Section 54B of the....

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.... AO is not justified in treating the land as urban land and bring the long term capital gains to tax. 13. We have gone through the record in the light of the submissions made on either side. In so far as the location of the land or the standing crops thereon is concerned, absolutely there is no dispute. Khasra revealed that there was standing crop of wheat and jwar on the land at the time of transfer. Further, as a matter of fact, ld. AO in the order dated 22.3.2013 u/s 143(3)/148 of the Act had accepted the agricultural income of the assessee to the tune of Rs. 41,000/-. Further, there is no explanation as to how the mutation could have taken place in the Revenue record if the land was put to commercial use as on the date of sale. Merel....