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2014 (3) TMI 951 - AT - Income TaxClassification of income - Agricultural income or capital gain - Sale of mahogany trees - Held that:- mahogany trees are planted as shadow trees and grew on their own without any human interference or human effort. Therefore, the mahogany trees grew naturally even though they were planted as shadow trees. Hence, this Tribunal is of the considered opinion that there is no cost of acquisition or improvement on such trees. Hence, the computation provision fails. Once the computation provision fails for computing the capital gains under the Income-tax Act, there cannot be any levy of capital gains tax. However, in this case, the assessee is not challenging the estimation of capital gains at 30 per cent. of the sale proceeds. The assessee's claim is that the entire income is agricultural income. This claim of the assessee as agricultural income cannot be correct in view of the judgments of the apex court referred in [1981 (2) TMI 1 - SUPREME Court]. Since the assessee is not challenging the treatment of 30 per cent. of the sale proceeds as capital gain, the Revenue may not have any grievance in the order of the Commissioner of Income-tax (Appeals). - Appeal of Revenue has no merit - Decided against Revenue.
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