TMI Blog2010 (9) TMI 560X X X X Extracts X X X X X X X X Extracts X X X X ..... rvey No. 126 admeasuring about 46,250 square metres situated at revenue village Varca, Salcete Taluka, in the District of South Goa (for short "the said land"). They purchased the said land for a sum of Rs. 8,00,000 under a sale deed dated February 28, 1988 as an agricultural land. On September 3, 1990 they sold the said land to Varca Holiday Beach Resort Private Limited for a sum of Rs. 73,00,000 and the consideration was paid equally to the wife and husband. The respondents filed separate returns of income under the Income-tax Act. The capital gainarising out of the sale of the land was claimed by each of them to be exempt, being arising out of the sale of agri-cultural land. The Assessing Officer held that the said land had non-agricultu ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ed by the respondents. She submitted the very fact that the respondents sold the said land within two years of its purchase to a purchaser for construction of a beach resort showed that the respondents had purchased the property with an intention of selling it for a non-agricultural use. The huge difference in the price nearly 10 times the purchase price would indicate that the land was purchased with an eye on the non-agricultural potential. The learned counsel for the appellant, therefore, submitted that the said land was not an agricultural land. The learned counsel for the appellant also invited our attention to the fact that the respondents had not shown any agricultural income during the period of two years from the date of the purcha ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ral inasmuch as no agricultural income was derived from this land and was not shown by the respondents in their income-tax returns. This was explained by the respondents by saying that there were coconut trees in the land but the agricultural income derived by sale of the coconuts was just enough to maintain the land and there was no actual surplus. Hence, no agricultural income was shown from this land. In our opinion, if an agricultural operation does not result in generation of surplus that cannot be a ground to say that the land was not used for the agricultural purpose. It is not disputed that the land was shown in the revenue record to be used for agricultural purpose and no permission was ever obtained for non-agricultural use by the ..... X X X X Extracts X X X X X X X X Extracts X X X X
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