Home Case Index All Cases Income Tax Income Tax + AT Income Tax - 2018 (12) TMI AT This
Forgot password New User/ Regiser ⇒ Register to get Live Demo
2018 (12) TMI 1756 - AT - Income TaxMAT computation - Deduction on account of gain on sale of agriculture land (rural) out of “Book Profit” - whether income derived from sale of land in the hands of the assessee is in nature of agriculture income exempt under section 10(1)? - if the answer to the same is in affirmative, whether it can be excluded while computing book profits under section 115JB - HELD THAT:- In the instant case, the assessee company is in the business of real estate development including purchase and sale of land where the sole purpose of purchase of the land is to sell the same to third parties or to carry out non-agricultural development activities. AO has also given a finding that the assessee has incurred expenditure on conversion charges on the pieces of land which have been sold during the year which shows clearly the future use of land for non-agriculture purposes and the said finding remain uncontroverted before us. The land in question thus loses its character as agriculture land and any gain arising on sale of such land cannot be regarded as agriculture income exempt under section 10(1) of the Act. In the books of account, the assessee has shown this income as profit on sale of agriculture land being capital gains and not as agriculture income, we agree with the contention of the ld DR that the provisions of section 115JB is a self contained code and the AO cannot tinker with the books of accounts prepared by the assessee as per Schedule-VI of the Companies Act and once this income in question is not declared by the assessee or treated in the books of account as agricultural income, then the same cannot be allowed as deduction as per the provisions of section 115JB. The books profits for the purpose of Section 115JB of the Act shall therefore, include the amount being the amount on sale of impunged pieces of land. - Decided in favour of revenue
|