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2018 (8) TMI 987 - HC - Income TaxCapital Gains - sale of agricultural land - scope of capital asset u/s 2(14) - AO rejected the claim of the assessee of exempt profit mainly on the ground that the land in question was sold to an industrial unit and had potential to be used for industrial purpose and therefore, the same was held as business profit - ITAT deleted the additions and allowed the benefit of exemption Held that:- the land was sold as an agricultural land and in fact, what was sold was agriculture land. What was the intention of the purchaser cannot be the determinative factor to treat the profit earned by the assessee on sale of agriculture land as business income. Similarly, merely because for whatever reason, the assessee has earned sufficient huge amount of profit also cannot be a ground to treat the profit earned by the assessee on sale of agriculture land as business income. The learned Tribunal has not committed any error in directing the Assessing Officer to treat the profit earned by the assessee on the sale of agriculture land as exempt under Section 2(14) of he Income Tax Act.
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