1976 (4) TMI 7

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....een referred to us for our opinion : " Whether, on the facts and in the circumstances of the case, the decision reached by the Tribunal that the land in question was agricultural land and as such not liable to capital gains was correct in law ? " The facts leading to this reference are as follows. We are concerned with the assessment year 1964-65. The assessee in this case is an individual c....

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....ary 16, 1963. The land was sold on yardage basis for a sum of Rs. 3,42,069. The Income-tax Officer treating the land as a capital asset worked out capital gains thereon at Rs. 2,40,193 and brought that amount to tax under the provisions of section 45 of the Income-tax Act, 1961, on the footing of capital gains. Against the decision of the Income-tax Officer, the assessee carried the matter in appe....

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.... allowed the appeal and set aside the order of the Income-tax Officer regarding capital gains. Against the decision of the Appellate Assistant Commissioner, the revenue carried the matter in appeal to the Tribunal and the Tribunal found that the land had been put to agricultural use right from the year 1936. No evidence had been led by the income-tax department to prove that the land had been put ....

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....e and there are no circumstances detracting from the inference which would follow from the actual agricultural use of the land, the land should be held to be agricultural land even though the land under consideration may be in the vicinity of developed or developing area. If the land is not actually a building site at the date of the sale, the inference flowing from the continuous agricultural use....