TMI Blog2011 (8) TMI 556X X X X Extracts X X X X X X X X Extracts X X X X ..... to as "the Act") vide his order dated 29.12.2009. For the sake of brevity and clarity, we dispose of both these appeal and cross objection by this consolidated order. 2. First we will take up Cross Objections of assessee as the issue raised in this Cross Objection of assessee is on jurisdiction, which will go to the root of the case. The only issue in this Cross Objection of assessee is, whether the asset transferred is agricultural land and, therefore, falls within the definition of capital asset as defined under section 2(14)(iii) of the Act or not. For this, assessee has raised following three effective grounds in his Cross Objection: "1. For that on the facts and in the circumstances of the case, the CIT (A) erred in law and in fact in not upholding the assessee's contention that no capital gains was chargeable to tax arose on sale of land as the asset transferred was "Agricultural Land" and therefore did not fall within the definition of "capital asset" defined in Sec. 2(14) of the I.T. Act. 2. For that on the facts and in the circumstances of the case, since the land in question was regularly assessed to land revenue and the same was recorded in the Land Records as ag ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 1ity is 8 to 9 kilometers. However, as per provisions of section 2(14)(iii) of the Act, the agricultural land will not be considered as a 'capital assets' if it is situated in any area within such distance, not being more than 8 kilometers from the local limits of Municipality or cantonment board. It means that the distance of 8 kilometers is to be computed from the local limit of the municipality. In present case the distance of assessee's 1and from the outer limit of Rajarhat municipality is approximately 2.5 Kilometers. This fact is evident from two certificates dated 13.10.2009 issued by Pradhan, Rajarhat Bishnupur, I No. Gram Panchayat. These certificates are enclosed at Annexure-II of this order. Further communication was made with BL LRO, Rajarhat, North 24-arganas to know the distance of assessee's plot from boundary of Rajarhat Municipality, A copy of reply received from BL LRO vide letter no.2031 /BL LRO/RHT/09 dated 06.11.2009 is enclosed at Annexure-III from which it is evident that the distance of assessee's plot from Rajarhat Municipality boundary is approximately 2.5 kilometers. The certificates at Annexure-II and III establishes beyond doubt that assessee's la ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... re situated at a distance of around 2.5 km from the boundaries of Rajarhat Municipality. This appears to go against the definition of agricultural land as given in Sec. 2(14)(iii)(b) of the Income Tax Act. Once it is established that the land is at a distance of 2.5 km. from the outer boundaries of the municipality the issue of limits, as spoken about in the said section, becomes paramount. In fact, the appellant in his submission has also admitted that 'here, a question arise whether distance has to be measured from the Jurisdiction of the Municipality (i.e. outer boundary) or local limits of the Municipality (i.e. Municipality Office). Also, the appellant's reliance on Notification No.9447 dated 06.01.1994 and the subsequent amended Notification No.1186 dated 28.12.1999, in my opinion, does not help his case because no mention of Rajarhat Municipality is seen there. I may add that, as per the definition, the character of the land is immaterial. So the question of whether an orchard can be classified as agricultural land is immaterial to the case. Similarly, whether or not any agricultural operations have been carried out therein is also not material. None of the arguments advance ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... form that 1. Distance of boundary of Rajarhat Municipality from plots No. 231, 233, 234, 235 and 236 of Mouza Kalaberia JL No. 30 is approximately 2.5 KM. 2. Important land mark of municipality area is mouza Gopalpur Rajarhat from above mentioning plots. " Further, at page 3 of assessee's paper book, copy of certificate of Pradhan Rajarhat Bishnupur 1 No Gram Panchayat was also referred, which reads as under: "To Whom It may concern This is to certify that Sudhanshu Kr. Mitra owned land at Mouza Kalaberia (JL No. 30, RS Dag No. 338, 366, 344, 360, 314, 316, Khatian No. 476) under this Gram Panchayat jurisdiction. The distance of above land from nearest important land mark situated in Rajarhat Municipality area is Raigachi. The distance of above land from the nearest boundry of Rajarhat Gopalpur Municipality (Raigachi) is 2.5 KM (approx.)" Ld. Counsel as well as Ld. CIT-DR Shri Niraj Kumar were on agreement in respect to the facts of the case that the assessee's land is situated at Village Kalaberia which is 2.5 KM from Rajarhat Municipality. Both admitted that Rajarhat Municipality came into existence in 1994 and it is also a fact that distance of assessee's land from o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s in clause (b) of section 2(14)(iii) of the Act as this section prescribes that any area within such distance, not being more than 8 km, from the local limits of any Municipality or Cantonment Board as referred to in sub-clause (a) of section 2(14)(iii) of the Act, as the central government may having regard to the extent of, and scope for, urbanization of that area and other relevant considerations, specify in this behalf by notification in the official gazette. As referred by Ld. Counsel the latest notification that is Notification under section 2(1A)(c), proviso (ii)(B) and 2(14)(iii)(b), i.e. Notification No.9947[F. No.164/3/87-ITA-I] dated 6.1.1994 whereas a draft notification was published by central government in exercise of powers conferred by item B of clause (ii) of the proviso to sub-clause (c) of clause (1A), and item (b) of sub-clause (iii) of clause 14 of section 2 of the Act, in the Gazette of India, Extraordinary, Part II, Section3, subsection (ii), dated 13.2.1991 under the Notification of Govt. of India in the Ministry of Finance, Department of Revenue, No. SO 91(E) dated 8.2.1991, for specifying certain areas for the purpose of said clauses and objections and su ..... X X X X Extracts X X X X X X X X Extracts X X X X
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