2009 (10) TMI 985

X X   X X   Extracts   X X   X X

Full Text of the Document

X X   X X   Extracts   X X   X X

....) 2005-06. The only ground raised by the Revenue in their appeal reads as under:- 'The Id. Commissioner of Income-tax (Appeals)-XVAhmedabad has erred in law and on facts ¡n giving relief out of addition of Rs.86, 78.746/- made by the AO in respect of income arising out of transfer of capital assets in terms of section 2(14) (iii) of the I. T. Act when the land ¡n question was for industrial use and was not agricultural land." 2 The brief facts of the case are that during the year the assessee has sold agricultural land for an amount of Rs.93,90,500/- on 14-02-2004. The purchase cost of acquisition and the document expenses for purchase of the said land was Rs.7,1 1,754/-. The survey-wise details of land along with....

X X   X X   Extracts   X X   X X

Full Text of the Document

X X   X X   Extracts   X X   X X

....essee, the said agricultural land is situated in an area which has population of less than 1 0,000 as well as at a distance of more than 8 Km from the local limits of Municipality (Ahmedabad Municipal Corporation), the said agricultural land does not fall as a "Capital Asset" in view of the provisions of Clause (iii) to sub section 14 of section 2 of the Act. Accordingly, since the said agricultural land is not a capital asset, there is no capital gain on the sale of said agricultural land. The assessee in support of the contention that Village Matoda, Taluka Sanand is having a population of less than 10,000 and it is located more than 20 Km from away from Ahmedabad Municipal Corporation, the certificate of Gram Panchayat was also filed alo....

X X   X X   Extracts   X X   X X

Full Text of the Document

X X   X X   Extracts   X X   X X

.... the land as an adventure in business of land and thereby a part of the land transaction business. During the course of assessment proceedings the assessee was asked to furnish the full and complete details of the transaction along with evidence for agricultural land like Form No.6-Hakk patrak, Form No.8A & 7/12 extracts. However, the assessee did not file the requisite details. After considering all the facts, the assessee's claim that the Short Term Capital Gain of Rs.86,78,746/- is exempt u/s 2(14)(iii) of the Act, is not correct and the income from sale of land ¡s taxable as business income of the assessee. 3. Aggrieved, the assessee preferred an appeal before the OIT(A). The CIT(A) deleted the addition by observing as under: ....

X X   X X   Extracts   X X   X X

Full Text of the Document

X X   X X   Extracts   X X   X X

....oming up as per sanction letter dated 5-11-2004 issued by Ministry of Commerce and Industry. As the land purchased and sold has been proved to be an agricultural land, the addition made by the AO of Rs.86,78,746 is directed to be deleted." 4. After hearing the rival contentions and going through the case records we find that the assessee has submitted the details like 7/12 Extracts, which show that the assessee is the owner of that agricultural land and the said land is situated in village known as Matoda, Taluka Sanand with population of less than ten thousand which also proves that this land is agricultural land and not a capital assets within the meaning of "Section 2(14)(iii) of the Act. That apart, the land purchased and sold by the....