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2022 (1) TMI 924 - AT - Income TaxGain on sale of land - Nature of land - agricultural land or capital asset or business receipts - main argument of the assessee is that all the purchases of the lands shown in the balance sheet are as a fixed asset and therefore, the same is treating as business income of the assessee is not correct - HELD THAT:- The assessee has performed near about 70 transactions out of which only 20 transactions are not sold and the remaining 50 transactions are completed by the assessee - as gone through the Annexure attached to the assessment order at Page Nos. 1 to 7, it gives entire picture of purchases and sales of the lands from that it is very clear that the intention of the assessee is only to make a profit out of buying and selling of the properties and therefore, the income arising out of the sale of the land rightly treated by the A.O as business income Simply showing the land in the balance sheet as an investment is not sufficient. The activities carried by the assessee i.e., buying and selling of the properties are considered in this case and we are of the opinion that the intention of the assessee is not to carry out agricultural operations only but to earn the profit. Therefore, the A.O has rightly taxed the income arising out of the sale of the lands as income from business. Agricultural income shown by the assessee - total holding of the land by the assessee is 65 acres. The agricultural income shown by the assessee is only ₹ 3,12,500/-. From the above, it is very clear that the agricultural income shown by the assessee is very nominal not only that it can be safely concluded that the assessee has not carrying any major agricultural operations and the return of income is showing some agriculture income claimed as exempt. The assessee is not improving the land purchased but the intention of the assessee has to be seen to assess the income. In this case, by considering the facts and circumstances of the case, we are of the opinion that the frequent buying and selling of the land is to earn the profit and the intention of the assessee is only quick earning of the money and therefore, the income earned by the assessee out of sale of land is a business income. The A.O as well as Ld. CIT(A) has rightly treated the income earned by the assessee is business income. - Decided against assessee.
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