TaxTMI 
TaxTMI 
2015 (7) TMI 1372
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....) on the above ground be set aside and that of the Assessing Officer be restored. 4 The appellant craves leave to amend or alter any ground or add new ground which may be necessary. " Assessee, an individual, filed his return of income on 30. 9. 2009 declaring income of Rs. l0, 00, 254/-. The AO completed the assessment on 30. 12. 2011 u/s. 143 (3) of the Act determining income at Rs. 2, 67, 36, 810/-. 2. The effective ground of appeal is about deleting the addition on sale of land by treating the same as agricultural land. As per the AIR information the assessee had sold immovable property at a cost 3. 80 crores. On perusal of computation of income, the AO found that the assessee had not disclosed any income from capital gain. Vide letter dt. 18. 8. 11, the assessee furnished copy of purchase deed of agricultural land. The perusal of the agreement revealed that the assessee had sold agricultural land comprising of survey no. 30, 37, 38 and 46 situated at Nighu village vide agreement dated 26. 5. 2008 for a sale consideration of Rs. 3, 80, 80, 000/-, that he had purchased the agricultural land vide agreement dated 22. 2. 2001 for Rs. 4. 50 lacs, that assessee had pai....
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....e consideration of 3. 03 crores in which the assessee's sale consideration was Rs. 2. 63 crores, that the assessee had filed certificate dt. 18. 9. 2009, issued by Thane Urban Agglomeration and Agricultural Deptt. , that Nighu was beyond 8 kms from TMC, that as per letter issued by competent authority the assessee was intimated that 13 villages including Nighu had been separated from NMMC, that when plot of land was sold on 26. 5. 2008 Nighu was not within the jurisdiction of NMMC, that registration and purchase of sale deed of the property had been carried out with sub-registrar Thane, that the jurisdiction of land was with TMMC, that Nighu was not within the distance of 8 kms from TMC, that capital gain arising therefore, was not chargeable under the Act. Accordingly, LTCG assessed by AO at Rs. 2. 57 crores was deleted. 4. Before us Departmental Representative (OR) submitted that issue was covered in favour of the department by the judgments delivered in the cases of Anjana Sehgal (40 taxmann. com 485), Khazan Singh (46 taxmann, com 238);Smt. Neeru Aggarwal ( 44 taxmann. com 295). Authorised Representative(AR) supported the order of the FAA and argued that the agricultural....
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....dies mentioned therein as specified in the notification. It is undisputed that the land in question is within the specified distance from the Panchkula municipality which falls in the State of Haryana while the land is in the State of Punjab. Thus, the land is urban land for the purpose of definition of 'capital asset' under section 2(14). The concept of municipality as a unit of State or the fact that a State has no jurisdiction to make law beyond its territory have no relevance for the purpose of determining whether a particular land was 'capital asset' or not for the purpose of taxing capital gains. If a land is adjacent to a municipality and is urban land covered under section 2(14), even though municipality and land fall in different States, land will continue to be urban land. If such land is excluded from the definition of' capital asset', the purpose of the statutory scheme will not be achieved. [Para 9] 7. To appreciate the controversy, it will be appropriate to refer to the relevant provisions of section 2 (14) of the Act: "2. ( 14) 'capital asset' means property of any kind held by an assessee, whether or not connected wi....
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....tion. It is undisputed that the land in question is within the specified distance from the Panchkula municipality which falls in the State of Haryana while the land is in the State of Punjab. Thus, the land is urban land for the purpose of definition of "capital asset" under section 2(14). The concept of municipality as a unit of State or the fact that a State has no jurisdiction to make law beyond its territory have no relevance for the purpose of determining whether a particular Land was "capital asset'" or not for the purpose of taxing capital gains. If the land is adjacent to a municipality and is urban land covered under section 2(14), even if municipality and the land fall in different States, the land will continue to be urban land. If such land is excluded from the definition of " capital asset", the purpose of the statutory scheme will not be achieved. (emphasis by us) 10. The judgments relied upon to submit that all words of a statute should be assigned meaning do not support the contention of the assessee, Including the land in dispute in "capital asset" does not ignore any word in the definition as assumed by the learned counsel. The speech of the Finance M....