TMI Blog2012 (10) TMI 710X X X X Extracts X X X X X X X X Extracts X X X X ..... agriculture purpose by the assessee as well as even by the purchaser, who is a builder, then the Sec 2(14)(iii) would not apply in the case of the assessee. Therefore, nature of transaction of purchase and sale rightly held as trading. Appeal decides in favour of revenue - ITA No. 5499/Mum/2011 - - - Dated:- 18-7-2012 - SHRI G E VEERABHADRAPPA SHRI VIJAY PAL RAO, JJ. Assessee by Sh M VB subramanian Revenue by Sh C G K Nair PER VIJAY PAL RAO, JM This appeal by the revenue is directed against the order dated 27/05/2000 and CIT(A) for the assessment year 2008-09. 2 The revenue has raised various grounds in this appeal; however, the only issue arises for our consideration and adjudication is as under: Whet ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Shri Pramod Satyanarayan Agarwal of Kondavar Group of Builders. Accordingly, after considering the various facts and circumstances, the Assessing Officer held that the transaction of purchase and sale of land in question are in the nature of adventure and therefore, are in the nature of trade and assessed the income as business income. 3.1 On appeal, the CIT(A) held that the land in question was recorded in the revenue records as agricultural land and remained so in the immediate next year therefore, the gain on the said land is not taxable being covered under section 2 (14)(iii). 4. Before us, the ld DR has narrated the facts as recorded by the Assessing Officer and pointed out that the assessee never declared any agricultural income. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... was purchased by the appellant along with his daughter from Sri Vasantrao Devtale and Sau. Nandatai Sudhir Supare of Nagpur in 2005 by purchase deed dated 17 Nov. 2005. At that time the piece of land having an area of 7.63 hectare was purchased for Rs. 4,50,000. (ii) The appellant is a farmer also as he is having agricultural land in Gujarat also. It is evident from the copy of Khedut Pothi submitted which is a record of details of land of farmer, as well as the balance sheets filed with returns for A.Y. 2003-04,2004-05, 2005-06 ,2006-07 and 2007-08 also. The 50% share in the land purchased at Nagpur by purchase deed of 2005 is also reflected in the balance sheet as on 31-3-2006 filed along with return filed for A.Y. 2006-07. (iii) Th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e details of consideration show that the assessee received the consideration in 3 instalments and about 40% of the consideration was received on 01/10/2006, which means that the sale deal was finalised prior to the receipt of part consideration on 01/10/2006 and the final payment was received on 11/05/2007. In other words, the assessee decided to sell the said land prior to 01/10/2006, which is within 11 months from the date of purchase. The Assessing Officer held that the transaction of purchase and sale are in the nature of adventure and therefore, it is in the nature of trade and not acquisition of capital asset for agricultural purposes. 5.2 In order to determine the real nature of transaction of purchase and sale various factors are ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ddy J.) is relied upon by learned counsel for the Revenue. The Bench observed : "Whether a land is an agricultural land or not is essentially a question of fact. Several tests have been evolved in the decisions of this court and the High Courts, but all of them are more in the nature of guidelines. The question has to be answered in each case having regard to the facts and circumstances of that case. There may be factors both for and against a particular point of view. The court has to answer the question on a consideration of all of them_a process of evaluation. The inference has to be drawn on a cumulative consideration of all the relevant facts." Several judgments of this court and the High Courts were referred to including a judgmen ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tal asset as per section 2 (14) (iii), the character of land being agriculture has to be decided with reference to the intention and purpose of acquiring the land. Once it is borne out from the facts and circumstances of the case that the intention of the assessee was not to put to the land for agricultural use and accordingly, it was not used for agriculture purpose by the assessee as well as even by the purchaser, who is a builder, then the provisions of section 2 (14) (iii) would not apply in the case of the assessee. 5.6 In the case of Smt. Debbie Alemao(supra), the Assessing Officer assessed the capital gain arising from sale of agricultural land; therefore, the said decision would not apply in the case in hand where the Assessing Of ..... X X X X Extracts X X X X X X X X Extracts X X X X
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