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TMI Blog2013 (8) TMI 188X X X X Extracts X X X X X X X X Extracts X X X X ..... e showing a capital balance as on 31.03.2006 at Rs.27,42,066/- had further shown an opening balance at Rs.28,17,141/- as on 01.04.2006. As the AO found there was a difference in the opening balance of Rs.75,075/- (28,17,141- 27,42,066) requested the assessee to furnish the explanation in respect of increase in the opening capital along with its source for which the assessee submitted the reconciled capital account as follows:- Op. Bal as on 1.4.2006 Closing Bal. as on 31.3.2006 1.4.2006 To Portfolio Investment in Shares Rs.13,24,575/-Opening as on 31.3.2007 12,18,532/-Difference Rs. 1,06,043 28,17,141, 1,06,043 27,42,066 1.4.2006 To Basis Commodities Cl. Balance 31.3.2007 W/off 4,73,925 1.4.2006 To Bank Ba ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... l as past savings. It is not the case of the Assessing Officer that the amount of Rs.9,90,675/- has been credited in the bank account during the current year. The Assessing Officer has simply rejected the explanation that the appellant does not maintain the books of account for the past financial years' affairs. Even if this explanation is rejected, there is no adverse material on record to suggest that the impugned investments are made afresh during the current year. Therefore, in my considered opinion, no addition can be made for the difference in the capital account as the appellant is having sufficient resources as mentioned by the Assessing Officer in para 5.2, 5.5 and 5.6 of the impugned assessment order. Accordingly, the impugned add ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ite Fund has been Purchased on 17/09/2004 and HDFC Multi cap fund investment made on 06/04/2005. Hence, the said investments are duly explained and are out of valid source. 2.4 We have heard the rival submissions on this ground and perused the material on record. At the outset, it is not disputed that the impugned investments are not related to the previous year to the assessment year under consideration. When the fact being so, we are of the considered opinion that the provisions of Section 68 of the Act is not applicable to the said investments for the year under consideration as the provision is applicable only when the sum is found credited in the books of the assessee in the previous year relevant to the assessment year. We also find ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tents of impugned assessment order grounds of appeal and written submissions of the appellant's authorised representative along with the case laws relied upon by him on this issue. I find force in the arguments and submissions of the Ld. Authorised Representative that the impugned agricultural land is not covered by the definition of capital asset u/s 2(14) of the I.T. Act 1961 as the impugned land is situated within the boundary of Saja Kadva Gram Panchayat having a population of less than 1000. The details of impugned land are as under:- Survey/Hissa No. Area Size Name of Village 53/5 0-62-0 0.74 Wadavali 53/10B 0-32-0 0.30 Wadavali The Assessing Officer has not brought any adverse material on record to suggest that the conte ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... )(iii). Hence, the agricultural land sold by the assessee is not a 'capital asset' since it is in rural area within the meaning of section 2(14)(iii), the impugned receipt cannot be brought to tax as capital gain by invoking section 54B of the Act. As the provisions of section 54B of the Act are not applicable to the facts of the case, the issue of holding period of the land for less than 2 years does not arise at all in the instant case. In view of that matter we do not find any justifiable reason to sustain the addition made by the AO. Accordingly, this ground is dismissed. 4. As mentioned earlier, it is not disputed by the Revenue at any stage of the assessment proceedings that the subject matter of transfer is agricultural land and als ..... X X X X Extracts X X X X X X X X Extracts X X X X
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