Home Case Index All Cases Income Tax Income Tax + AT Income Tax - 2011 (11) TMI AT This
Forgot password New User/ Regiser ⇒ Register to get Live Demo
2011 (11) TMI 493 - AT - Income TaxDetermination of nature of charges/compensation received - rent fixed between the parties, compensation paid for carrying out changes in the area, its topographgy, terraces, fields, etc. and also to cut/remove all fruit trees - compensation was shown as agricultural income in the original return by assessee and then as capital receipt not chargeable to tax in revised return – Revenue deeming it be income from other sources – Held that:- The standing trees are capital assets as it constitute property of any kind as defined under section 2(14) of the Act. The said capital asset has been transferred by way of the transaction entered into by the assessee with the lessee under which Transfer rights of the assessee in the said asset stand extinguished as the parties entered into agreement for cutting and removing the same from the land in question. The profits arising on such transfer of the 'capital asset' by the assessee is chargeable to tax as income from capital gains in the hands of the assessee as decided in Travancore Tea Estates Co. Ltd vs CIT, Kerala (1973 (2) TMI 21 - KERALA HIGH COURT). Moreover, the Assessing Officer has erred in treating the income as income from other sources by merely disbelieving the evidence produced by the assessee, and without bringing on record any clinching evidence to the contrary. Therefore, orders of the CIT(A) are set aside Assessing Officer is directed to compute the income under the head "income from capital gains". - Decided partly in favor of Revenue.
|