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2017 (11) TMI 1664 - ITAT CHENNAINature of sale of land - agricultural land or capital asset - distance from the nearest Municipality - Held that:- A perusal of the Assessment Order shows that the AO has recognized that the assessee was running a Nursery under the name and style of Soundariya Nursery. A perusal of the provisions of Sec.2(1A) as also Sec.2(14)(iii) shows that agricultural land is not liable to be treated as a capital asset subject to the condition that the land is situated in an area where the Municipality has a population of less than 10,000 or at a distance of more than 8 KMs from Municipality or cantonment which has a population of more than 10 lakhs. In the present case, admittedly, the land sold by the assessee is situate beyond 8 KMs limit, the land Revenue is collected in the form of Kist in respect of the agricultural land, the land Revenue records shows the land as agricultural land. Thus, all the conditions required for holding the land as agricultural land stands complied. This being so, we are of the view that the land sold by the assessee being an agricultural land and consequently the same cannot be treated as a capital asset, the sale of which gives rise to capital gains. - decided in favour of assessee
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