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2022 (1) TMI 144 - AT - Income TaxExemption claimed u/s 54B - decision of the A.O. to treat the Agriculture Land as Non Agriculture - Capital Gain on sale of agriculture land - HELD THAT:- We find that the assessee in the sale deed of said land mentioned the nature of land as agricultural land. The assessee also placed on record the copy of Form-8, wherein the user of land is clearly written in Gujarati language as “Kethi LayakUpagyog” i.e. “agricultural purpose”. In the valuation report, the property is shown as agricultural land. Though, in specification of property, the surrounding factors are mentioned. We find that before the AO as well as CIT(A), the assessee categorically stated that land is situated on the bank of river Mindhola, which area is affected by very high salinity and regular crop of sugarcane or other trees are not possible. The assessee used the land for cultivatation and growing of Grass which is not affected by floods. We find that in the documentary evidences furnished by the assessee the nature of land is clearly mentioned as agriculture use. AO has not made any investigation on the assertion of assessee. AO presumed that growing of grass is not agriculture activities. We noted that the AO arrived on conclusion on the basis of his presumption that Grass is not agriculture product. AO has not brought any adverse evidence to counter the evidence furnished by the assessee. The best evidence available before the AO was Form- 7 & 8 extract, wherein the nature of land is mentioned as agriculture land. Mere fact that the assessee has not shown agriculture income from the piece of land would not change its character. In our view, in absence of any adverse material, the presumption of AO that no income is shown from the sale of Ghass is not justified. Hence, the ground of appeal raised by the assessee is allowed.
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