TaxTMI 
TaxTMI 
2026 (3) TMI 1567
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....d goes against the statutory provisions of the Act. 2. The Ld. Addl.CIT (A) has erred in law and facts allowing the grounds of the assessee regarding the nature of property (capital asset or not) Under consideration merely on the basis of a letter of Junior Town Planner, Gandhinagar Urban Development Authority wherein there is nowhere mentioned about the nearest point (name of the place) of the Gandhinagar Municipal Corporation whereas as per letter dated 17.08.2021 of the Senior Town Planner, Gandhinagar, Urban Development Authority, the areal distance of the parcel of the land under consideration was within 2KM from the Gandhinagar Municipal Corporation. 3. The Ld. Addl.CIT (A) has erred in law and facts allowing the appeal of the assessee by ignoring the notification dated 17.01.2008 & 16.03.2010 of Urban Development Department of Gujarat Government available on public domain. In fact, the assessee has purchased five land parcels of Basan(1), Palaj(1) and Sargasan(3) villages. Basan and Palaj are in the east bank of Sabarmati River which flows from the Gandhinagar City whereas Sargasan falls in south-west direction. Sargasan falls between Ahmedabad Municipal Co....
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....9.03.2022 for A.Y 2015-16, therefore the grounds of appeal are adjudicated as under: 9.1.1 The main contention of the assessing officer is that Even if a property. transaction involves more than one buyer and share of each buyer in such transaction is less than Rs. 50 lacs, if the total value of the property exceeds Rs. 50 lakhs, then the provisions of Section 194IA will be applicable. In such case, TDS was required to be deducted and deposited by each buyer in accordance with their share in the property. Assessee's contention is that in case of each property, there are multiple buyer and multiple sellers and in each case the payment of consideration made to the owners of land by individual purchaser is less than the prescribed limit of Rs. 50 lakhs under section 194IA of the Act. 9.1.2 Legislative Framework: Section 194-IA, inserted by Finance Act 2013 (w.e.f. 1 June 2013), mandates 1% TDS on consideration for transfer of immovable property (other than agricultural land) if the consideration is Rs. 50 lakh or more. Sub-section (2) provides that no deduction shall be made where the consideration is less than Rs. 50 lakh. The legislative inten....
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....sferee in respect of any immovable property, then the consideration shall be the aggregate of the amounts paid or payable by all the transferees to the transferor or all the transferors for transfer of such immovable property In view of the said amendment in the finance bill, where the share of consideration paid by the assessee to each one of the co-owners is less than the limit prescribed u/s 194IA of the Act ie Rs. 50,00,000/-, then it is outside the scope of section 194IA is valid and correct. Hence, the appellant has not defaulted by not deducting TDS u/s 194IA on the said transactions. Also I agree that in case of in case of RS No. 414 at Village Sargasan the purchase consideration wherein to Shri Chehuji Shibuji (confirming party for transaction stated at Sr.no5) an amount of Rs. 5700000/- was paid, However the amount paid to the confirming party is outside the purview of section 194IA of the Act for the reasons as under. As per Section 3(26) of General Clauses Act, 1897 "Immovable property shall include land, benefits to arise out of land, and things attached to the earth, or permanently fastened to anything attached to the earth; Based on above. ....
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....lometers, from the local limits of any municipality or cantonment board and which has a population of more than ten lakhs. measured aerially is treated as Rural Agricultural Land and not a capital asset as per section 45(1) of the act. The assessee has submitted a certificate from the Gandhinagar Urban Development Authority (GUDA) confirming that all the relevant lands are classified as rural agricultural lands and specifying the aerial distance of each property from the Gandhinagar Muncipal Corporation limits. The population of Gandhinagar Municipal Corporation is 334224 and all the land parcels are beyond 6 kms of municipal limits and hence are regarded as rural agricultural land and not a capital asset. The census of district has been produced which is placed on record which shows population of Gandhinagar municipal corporation as 334224. 9.1.7 Applicability of Section 296AA: Once no TDS obligation exists under s.194-IA, section 206AA cannot be triggered. Even otherwise, the AO's automatic application of 20% rate without verifying Form 60 declarations of agriculturist-sellers is contrary to law and CBDT guidelines. In the light of above facts ....