TMI Blog2022 (10) TMI 228X X X X Extracts X X X X X X X X Extracts X X X X ..... i B.V. Jhaveri, Advocate For the Revenue : Shri Hoshang B. Irani, Sr. A.R. ORDER PER SANDEEP SINGH KARHAIL, J.M. The present appeal has been filed by the assessee challenging the impugned order dated 13/07/2021 passed under section 250 of the Income Tax Act, 1961 ( the Act ) by learned Commissioner of Income Tax (Appeals) 49, Mumbai [ learned CIT(A) ], for the assessment year 2017 18. 2. The assessee, in the present appeal, has raised following grounds: 1. The Commissioner of Income Tax (Appeals)-49 Mumbai ( the CIT-A) has erred in law and on facts by confirming the addition of short term capital gain of Rs.47,58,980/- on sale of agricultural land to the total income of the assessee. 2. The CIT(A) has failed to appreciate the fact that the land in fact is not an agricultural land and as such is not a capital asset as defined u/s.2(14) of the Income Tax Act, 1961 ( the Act ). 3. The CIT(A) has erred in law and on facts by coming to the conclusion that the agricultural land in question is not an agricultural land on the ground that no agricultural activity has been carried out by the Appellant on the said land. 4. The CIT(A) has failed ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s of any municipality or cantonment board as well as population. Accordingly, the assessee submitted that there is nothing in law to suggest that when no agricultural activity is carried out by the assessee on the land, the said land ceases to be agricultural land. The AO vide order dated 23/12/2019 passed under section 143(3) of the Act did not agree with the submissions of the assessee and held that no agricultural activity has been carried out on the land since the 7/12 extract itself shows the land as barren. The AO further held that nothing has been brought on record to prove that the agricultural activity was carried out on the land in question and merely because land is recorded as agricultural in revenue records, the same would not mean that the said land is an agricultural land. Accordingly, the AO treated the land as capital asset and treated the profit of Rs. 47,58,980 on sale of land as short-term capital gains and added the same to the total income of the assessee. 5. In appeal, learned CIT(A) vide impugned order dated 13/07/2021 dismissed the appeal filed by the assessee and held that in order to come within the category of agricultural land, it must not only be ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... passed by the lower authorities and submitted that no evidence has brought on record to prove that land was ever used for agricultural purpose. 8. We have considered the rival submissions and perused the material available on record. The assessee, as noted above, is an individual and also claimed to be an agriculturist. The assessee purchased a plot of land bearing survey No. 88/3, admeasuring 36 Gunthas, situated at Village Kunenama, Maval Taluka, District-Pune on 06/12/2013 along with his wife for a total consideration of Rs. 1,56,65,000. In the deed of conveyance in respect of the aforesaid purchase transaction, the land is stated to be an agricultural land. Subsequently, vide deed of conveyance dated 20/07/2016 assessee along with his wife sold the said land for a total consideration of Rs. 2,60,00,000. Since, the assessee s share was only to an extent of 50% in the aforesaid property, assessee claimed exemption of Rs. 47,58,980 (i.e. 50% of Rs. 95,17,960 being profit arising from sale of aforesaid property). It is the claim of the assessee that the aforesaid land, purchased in the year 2013 and thereafter sold in the year 2016, was an agricultural land and therefore the sa ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the present case. The claim of the Revenue is that the land in respect of which profit was earned by the assessee is not an agricultural land and therefore the same falls within the category of the term capital asset for the purpose of section 2(14) of the Act and thus the gain arising from transfer of said capital asset is chargeable to tax under the head capital gains . As noted above, apart from the purchase and sale deeds of conveyance entered into by the assessee as well as 7/12 extracts from land revenue records, no other evidence has been brought on record to establish the fact that the land in question is an agricultural land. Since, it is the claim of the assessee that the land is an agricultural land, therefore, the primary onus is on the assessee to prove the same. The assessee has also not brought any evidence on record that the said land prior to its purchase by assessee in the year 2013 was ever used for the purpose of agriculture. We find that the said fact is also not evident from the 7/12 extract from land revenue records. 12. We find that the coordinate bench of the Tribunal in Abhijit Subash Gaikwad (supra), after considering various decisions, inter-alia, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e put to use by the purchaser for agricultural purposes for a reasonable span of time in future' 22. The judicial precedents have laid down that the expression 'agricultural land' though not defined under the Income-tax Act, but would be applicable to such land where the actual user of the land was for agricultural purposes in recent times. Just because the land was used for agricultural purposes in the remote past or it continues to be assessed in the land revenue records as agricultural land is not decisive to determine the nature of land being agricultural land. Where the land has not been put to use for agricultural purposes for reasonable span of time prior to the date of its transfer, the land in question cannot be held to be agricultural land. The onus was upon the assessee to establish its case of having cultivated the land in recent past and in the absence of assessee having discharged its onus and merely because the land is recorded as agricultural land in the revenue records, does not establish the case of assessee. 23. Now, coming to the facts of the present case, the assessee before the Assessing Officer had furnished the copy of 7/12 extract,acco ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... gricultural income has been declared in any of the year of holding of such land. In the absence of the same and in the totality of the facts and circumstances, we find no merit in the claim of the assessee that the said land sold by the assessee is an agricultural land and sale proceeds of which are exempt from tax. 25. The learned Authorized Representative for the assessee on the other hand placed reliance on the ratio laid down by the Hon'ble Delhi High Court in Hindustan Industrial Resources Ltd. (supra), wherein it was held that the fact that the assessee did not carry out any agricultural operations did not result in any conversion of the said land into industrial land and the finding that the land was not agricultural land was reversed by the Hon'ble Delhi High Court (supra). However, the finding of the Hon'ble Delhi High Court (supra) is contrary to the finding of jurisdictional High Court in Gopal C. Sharma (supra), which has been referred to by us in the paras hereinabove, which in turn has been relied upon by the Assessing Officer/CIT(A) and also by the learned Departmental Representative for the Revenue. Though the learned Authorized Representative for t ..... X X X X Extracts X X X X X X X X Extracts X X X X
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