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2022 (6) TMI 70 - ITAT AHMEDABADShort Term Capital Gain - assessee had introduced the agricultural land in question as stock-in-trade in the books of the partnership firm as per the partnership deed - HELD THAT:- It is pertinent to note that the land in question remained to be an agricultural land till 11.01.2011 when it was converted into non-agricultural land and the same was transferred by the assessee in his individual capacity to M/s Bhogilal Odhavji Industrial Enterprises Pvt. Ltd. by a registered conveyance deed on 12.05.2011. The land in question thus was never transferred by the assessee validly to the partnership firm of M/s. Vallabh Developers much less in the year under consideration when it remained an agricultural land since valid transfer of the same to the firm of M/s. Vallabh Developers was not permissible in the eye of law as the said firm was not agriculturist. The valid transfer of the said land thus was taken place after its conversion into non-agricultural land by a registered conveyance deed dated 12.05.2011 by the assessee in his individual capacity to M/s Bhogilal Odhavji Industrial Enterprises Pvt. Ltd. giving rise to the long term capital gain which was taxable in the hands of the assessee in AY 2012-13. The assessee duly declared such capital gain in his return of income filed for AY 2012-13 and although the learned DR has raised certain questions relating to the computation of such capital gain as well as the admissibility of deduction claimed under Section 54B of the Act at the time of hearing before us, it is observed that the learned CIT(A) in his impugned order has given direction to the Assessing Officer to examine the computation of income from capital gains offered on the sale of land by the assessee for its correctness or otherwise in AY 2012-13 in the light of observations made by him in his impugned order. As such, keeping in view all the facts of the case and having regard to the contentions raised by the learned representatives of both the sides as discussed above, we are of the view that there was no valid transfer of land in question by the assessee to the partnership firm of M/s. Vallabh Dvelopers in the year under consideration giving rise to any capital gain and the transfer of the said land having validly taken place only in the previous year relevant to AY 2012-13 by the assessee to M/s. Vallabh Developers, the capital gain arising from the said transfer was chargeable to tax in the hands of the assessee for AY 2012-13 as duly declared by the assessee in his return of income for AY 2012-13. In that view of the matter, we uphold the impugned order of the learned CIT(A) deleting the addition made by the Assessing Officer on account of short term capital gain and dismiss this appeal of the Revenue.
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