TaxTMI 
TaxTMI 
2019 (11) TMI 30
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....held immovable property situated at Adalaj, Gandhinagar during the year under consideration: SI. No. Revenue Block No. Total Sale Consideration Share of Sale Consideration received by you Regd. No. and Date 1. Block No.- 52 Rs.l,54,80,000/- Share-17% Rs. 26, 31, 600/- 6693 dated 08.5.2013 2. Block No. -48 Rs. 1, 36,57,000/- Share-17% Rs. 23,21,775/- 6690 dated 08.5.2013 3. Block No.-57 Rs. 1,27, 98, 500/- Share-17% Rs. 21,75,745/- 6695 dated 08.5.2013 Total Share Received in Sale Consideration Rs. 71,29,120/- 4. However, the assessee had not offered any capital gain for tax on sale of above mentioned immovable property. On being asked, the assessee had submitted his reply vide letter dated 22.11.2016. The crux of the reply furnished by the assessee is as under: ""The assessee had sold three agriculture land which were bearing block no. 52, 48, and 57. All the agricultural land is situated at Adalaj. The above agricultural land were rural agricultural land and as per the provision of Section 2(14) "Capital Assets" Rural Agricultural land were exempt from the capital gain. As per the definition of Section 2(14) (iii)(a) i....
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.... qualify for the rural assets and is exempt from the capital gain."" 5. The assessee's submission that land in question is situated at Adalaj which fall under the Gandhingar Urban Development Authority (GUDA) and the same is equivalent to a municipality and as the population of Adalaj as per census 2001 is less than 10,000, the land in question is not a capital asset as per the definition of Section 2(14)(iii)(a) of the Act, is not found acceptable. Provisions of Section 2(14)(iii)(a) of the Act says as under: 2(14} "capital asset" means property- of any kind held by an assessee, whether or not connected with his business or profession, but does not include- (///) agricultural land in India, not being land situate- (a) in any area which is comprised within the jurisdiction of a municipality (whether known as a municipality, municipal corporation, notified area committee, town area committee, town committee, or by any other name) or a cantonment board and which has a population of not less than ten thousand [***]; or (b) in any area within the distance,, measured aerially,- (i) not being more than two kilometres, from the local limits of any municipality or cantonment....
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....hin the meaning of Section 2(14)(iii)(b) of the Act, inserted w.e.f. 01.04.2014. A copy of letter received from the Town Planner, GUDA, Gandhinagar has also been given to the assessee. 9. Even other-wise also, with a view to verify the fact that whether the aforesaid land situated at Adalaj sold during the year under consideration was Capital Asset or not as per the provisions of section 2(14)(iii) of the Income Tax Act, 1961, enquiries were made by issuing a notice u/s 133(6) of the Act dated 19.10.2016 to the Sr. Town Planner, AUDA, Usmanpura, Ahmedabad. In response to this notice, reply from Ahmedabad Urban Development Authority(AUDA) has been received vide Ref. No. : No. 15287 dated 16.11.2016. In its reply, it has been submitted by the Sr. Town Planner, AUDA, Ahmedabad that the "the Minimum Distance of revenue limit of the village Adalaj from AMC limit is 706 Mt. A copy of letter received from Sr. Town Planner, AUDA, Ahmedabad has also been provided to the assessee. 10. Therefore, it has been established that the land in question are situated within a radius of 8 Kms. of Ahmedabad Municipal Corporation Limit (AMC). Therefore, the said land sold during the year under conside....
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....first day of the previous year. (b) in any area within such distance, measured aerially,- (i) not being more than two kilometres, from the local limits of any municipality or cantonment board referred to in item (a) and which has a population of more than ten thousand but not exceeding one lakh; or (ii) not being more than six kilometres, from the local limits of any municipality or cantonment board referred to in item (a) and which has a population of more than one lakh but not exceeding ten lakh; or (iii) not being more than eight kilometres, from the local limits of any municipality or cantonment board referred to in item (a) and which has a population of more than ten lakh Thus, as per the definition of section 2(14)(iii)(a) it means if the agriculture land situated in any area which is comprised within the jurisdiction of municipality (whether know as municipality, Municipal Corporation, notified area committee, town committee or by any other name) and its population should be less than 10,000 as per the last published census. That starting words of section 2(14)(iii)(a) read us land situated in any area, which means that section is applicable area wise. That the....