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2015 (1) TMI 1472 - ITAT HYDERABADTaxation of capital gains on sale of agricultural land pertaining to assessee - determine the sale price as income of assessee - HELD THAT:- Assessee was not aware about the statement given by the said Smt. Bhagya Lakshmi and others. It is also noticed that assessee has sold the agricultural property to one Mr. T. Chandra Sekhar and Shri V. Papaiah being the vendors. How these two are connected with Smt. Bhagya Lakshmi in the purchase of the so called 15.14 acres is not coming out of the assessment order. Not only that the basis of determining the price is also not forthcoming from the orders. In fact assessee asked for copies of the documents relied on by the AO which are also denied to him as stated above. As perused the sale deed dt.17-11-2006. It is clear from the recitals that property is ancestral property devolved on assessee by way of partition. In that case, the status of assessee, being HUF property or individual also required to be determined. Not only that, 1/4th of the share of the property, as can be seen from the recitals of the sale deed, pertain to his son who also became vendor No.2. When the sale deed is very clear about respective shares, how the entire amount can be brought to tax in the hands of assessee was also not explained by the AO - document of sale indicates that the property sold was agricultural land. Whether sale of agricultural land can be considered as a capital asset or not also required to be considered. Principles of natural justice have not been followed in this case, we are of the opinion that assessee should be given due opportunity. Since assessee seems to be an illiterate person, it is the duty of the officer to explain the provisions of law, so that the person can follow the proceedings. It is all the more necessary that Assessing Officer should follow the provisions of law before raising a demand against assessee - CIT(A) dismissed the appeal without considering any of the contentions or issues involved in the assessment - assessee should be given due opportunity. AO should determine the correct status, shares of the assessee and the price he received so that correct capital gains can be brought to tax. AO is directed to examine all the issues and then only complete the assessment as per facts and provisions of law. Assessee is free to raise any objections or contentions involved in the assessment procedure. Appeal is allowed for statistical purposes.
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