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2014 (7) TMI 133 - ITAT HYDERABADLevy of capital gains – Cost of acquisition - Sale of land - agricultural land or Non-agricultural land – Held that:- Assessee has sold agricultural land which is away from the municipal limits on which there is no doubt and further fact that assessee’s land was acquired by the State Government as agricultural land and based on the pahani patrikas and the report of the MRO as well as Horticulture Officer evidencing that these survey numbers are having agricultural operations - evidence indicates that assessee is indeed cultivating the land and the land in question is agricultural land - Sale of agricultural land does not result in capital gains tax as agricultural land is not a capital asset under the definition of ‘capital asset’ in the Income Tax Act - the AO did not give any opportunity while inspecting the land nor he has given any opportunity to examine the MRO certificates obtained by him - assessee should be given one more opportunity to support his contentions - Assessee is also willing to take the A.O. to the land to show that the land in question is still agricultural land - physical verification of the land will clinch the issue without any doubt, so that not only on legal principles but also factually also assessee’s contentions can be proved or disproved – thus, the order of the CIT(A) is set aside and the matter is remitted back to the AO for fresh adjudication – Decided in favour of Assessee.
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