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2023 (10) TMI 849 - ITAT VISAKHAPATNAMRevision u/s 263 - gain / loss on sale of property - Correct head of income - treatment of income from Capital Gain as Income from Business by PCIT - HELD THAT:- The assessee has sub-divided the land into parts to fetch a higher market price on the sale of the same and at the same time the Revenue also could not bring on record any evidence to prove that the assessee held the capital asset as stock in trade and the purchase and sale of property was with a view to earn profits through trading transactions. AO after making necessary enquiries and thorough examination / verification of the documents and the computation statement submitted by the assessee accepted the net long term capital gains offered by the assessee in his revised return of income. Further, it is noted that the Ld. Pr. CIT ought to change the character of the income i.e., from capital gains to business income As in the case of CIT vs. Kasturi Estates (P) Ltd [1965 (10) TMI 7 - MADRAS HIGH COURT] has clearly held that when the asset is held as a capital asset by the assessee, where the intention of the assessee is to derive higher profits by dividing it into plots cannot alter the nature of income earned by the assessee. Also relying on the case of A. Mohammed Mohideen [1988 (11) TMI 95 - MADRAS HIGH COURT] and also SNF (India) Pvt Ltd [2023 (6) TMI 219 - ITAT VISAKHAPATNAM] we are of the considered opinion that the direction given by the Ld. Pr. CIT to the Ld. AO to re-do the assessment by invoking the provisions of section 263 of the Act is not in sustainable in law. As assessee is not engaged in systematic series of transactions of purchase and sale of land but, however has divided the land into plots only to derive higher profits in the nature of capital gains and has offered the same while filing the revised return of income which was also not disputed by the Ld. AO. Appeal of the assessee is allowed.
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