TaxTMI 
TaxTMI 
2023 (12) TMI 707
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....x Act, 1961 ("the Act") for the Assessment Year 2013-14. 2. The assessee has raised the following grounds of appeal:- "1. For that the Ld. CIT(A) erred in confirming the order of the AO passed u/s 154 when in fact the entire sold lands were Rural Agriculture lands and thus the said lands do not come under the purview of the definition of Capital Asset as provided under section 2(14)(iii) and thus the entire calculation of capital gain on sale of rural agriculture land was illegal, wrong and without any sanction of law. 2. For that the Ld. CIT(A) erred in confirming the action of AO by invoking the provision of section 154 of the Income Tax Act since the mistake, which was sought to be rectified by the AO, was not a mist....
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....02,90,660/- but the sale consideration from sale of agricultural land declared in income tax return at Rs. 66,66,657/-. In the return of income assessee had claimed exemption under section 54 of the Act at Rs. 69,80,000/-on account of purchase of agricultural land. However, the ld. Assessing Officer completed the assessment recalculating the longterm capital gain at Rs. 42,48,171/- as against Nil income declared by the assessee after claiming exemption under section 54 of the Act. Income assessed at Rs. 47,90,471/-. Thereafter, the ld. Assessing Officer on perusal of the assessment records observed that certain apparent mistakes have occurred and thus passed an order under section 154/143(3) of the Act and during the course of proceedings c....
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....unt of ignorance included in his income any amount which is non-taxable or is not income within the contemplation of law, the assessee may bring the same to the notice of the Assessing Officer to which the Assessing Officer is satisfied, he may grant the assessee necessary relief and refund the tax paid in excess. Citing this decision, it is submitted that since the lands sold during the year are agricultural lands which were being used for the purpose of agricultural operation and they are not capital assets as defined u/s 2(14) of the Act, the capital gain arising from the sale of such land is exempt. Further it is claimed that even if agricultural land sold during the year are considered as capital asset then also assessee is eligible to....
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....ssessee had claimed exemption u/s 54 of the Act but this Section relates to profit on sale of property used for residence and cannot apply on the case of the assessee where agricultural land has been sold. The ld. Assessing Officer also observed that even Section 54F of the Act cannot be applied because the same pertains to capital gain on transfer of certain capital assets not to be charged in case of investment in residential house. During the course of proceedings u/s 154 of the Act, assessee gave detailed reply firstly contending that agricultural land in question is not a capital asset and, therefore, capital gain arising from sale thereof is exempt from tax. Second contention by the assessee was that even if the land sold during the y....
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....s of sale deeds as well as certificate issued by Dadpur Gram Panchayat and find merit in the claim of the assessee that the agricultural land sold during the year do not fall within the definition of capital asset provided u/s 2(14)(iii) of the Act and, therefore, the capital gain arising from sale thereto is exempt from tax. So far as the finding of the lower authorities that the assessee did not provide this fact during the course of assessment proceedings, we note that during the course of rectification proceedings, though the same were initiated by the Assessing Officer but once certain facts were placed before the Assessing Officer during the course of such rectification proceedings, then he ought to have taken note of the same and sho....