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2010 (4) TMI 272 - PUNJAB & HARYANA HIGH COURTLong Term Capital Gain - adventure in the nature of ‘trade or sale of capital asset’ - taxability of the income declared by the assessee-respondent on the sale of ancestral property, known as ‘Leela Bhawan’, situated at Patiala - The question is whether the activity of sale of land is a trading activity or it is long term capital gain. - On account of subsequent activities of converting his residential property into a commercial property leaving 42% of area for roads by hiring the services of a property dealer, the Assessing Officer held that the ‘capital assets’ were converted into ‘Stock-in-trade’. – Held that: in the instant case there was no such material which may constitute the basis to hold that the assessee-respondent has converted or treated the ‘capital asset’ as ‘stock-intrade’ attracting the application of Section 45(2) of the Act - the assessee-respondent has maximised his realisation by sale of his ancestral capital asset which has been incorrectly held in the nature of trade by the Assessing Officer. – decided in favor of assessee
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