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2016 (7) TMI 422 - AT - Wealth-taxNature of land - whether the land held by the assessee is an urban land coming within the definition of asset as per section 2(ea) of the Act or is a stock in trade, which is kept outside the definition of asset? - Held that:- The assessee has filed a statement of affairs before the assessing officer and claimed that the impugned land is an immovable property. Just because land is under Joint Development, it cannot be considered that the asset is held for the purpose of commercial exploitation thereby it is classified as stock-in-trade. The assessee has failed to prove that the impugned land is stock-in-trade with any evidences. On the other hand, the income tax return filed for the assessment year 2009-10 in ITR form-2 which is meant for individual and HUFs not having income from business or profession, abundantly proves that the assessee is not involved in any business. By his conduct, the assessee proved that he is not into the business either in the past or in the future. If the JDA is entered for development of the property, it is for the builder who comes under the activity of business but not the assessee. The assessee has purchased the land as an investor, consequently any gains from the land would be assessable under the head income from capital gains. Therefore, we are of the view that the assessee has failed to prove that the impugned land held by him is stock-in-trade. In the present case on hand, admittedly the land held by the assessee is an urban land. However, by virtue of a injunction order from the court, status quo should be maintained on the impugned land therefore, land on which construction of a building is not permissible under any law for the time being in force is not an urban land within the meaning of asset u/s 2(ea) of the Act. Therefore, we are of the view that the asset held by the assessee is not urban land, coming within the definition of assets as defined u/s 2(ea) of the Act. Therefore, we set aside the order of CIT(A) and direct the A.O. to delete the impugned land from the definition of assets for the purpose of wealth tax. - Decided in favour of assessee.
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