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2016 (3) TMI 46 - AT - Income TaxTaxing Agricultural lands - Land-in-question treated as ‘asset’ under the Wealth Tax Act - Held that:- So long as the lands are agricultural in nature, the same cannot be treated as ‘capital asset’ in view of the provisions of Wealth Tax Act. Section 2(ea) of Wealth Tax Act defines ‘asset’ in relation to assessment year commencing on 1st April, 1993 in which urban land is included as an asset. Explanation 1(b) defines urban land means, land situated in any area which is comprised within the jurisdiction of a municipality etc within a distance of not being more than 08 KMs from the local limits of a municipality etc. However, proviso has been amended by the Finance Act, 2013 w.e.f. 01-04-1993 so as to state “but does not include land described as agricultural land in the records of the Government and used for agricultural purposes’. This indicates that even if a land is situated within 08 KMs of a town or municipality as specified, if such land is classified as ‘agricultural land’ in the records of the Government and used for agricultural purposes, it cannot be treated as an ‘asset’ for the purpose of WT Act. In fact the ground raised by the Revenue is not maintainable in the sense, that linking of agricultural income to agricultural land is not required and therefore, Ld. CIT(A) is not bound to do that exercise which is not prescribed by the Act. It is the AO who should have examined these matters at the time of assessment and should have verified whether the land is classified as ‘agricultural land’ or not? Then, the question of agricultural operations comes into picture. As seen from the assessment order, AO has not even discussed, why he is treating the agricultural land as ‘asset’, and how the provisions of the Act apply. As can be seen from the above, the land is classified as agricultural land and agricultural operations were also being carried on. Since the land-in-question cannot be treated as ‘asset’ under the Wealth Tax Act, we do not see any reason to interfere with the order of the CIT(A) - Decided against revenue Addition on the valuation of buildings other than self occupied buildings - whether CIT(A) deleted the addition without linking the income from house property? - Held that:- When assessee is offering the rental income from the buildings and those properties which are not to be included as assets were included without any discussion by the AO, we are of the opinion that Ld. CIT(A) has correctly examined and deleted the addition, which cannot be made at the first instance. Since the issue is examined in detail by the Ld. CIT(A), we do not see any reason to disturb the findings. - Decided against revenue
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