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TMI Blog2010 (10) TMI 1082X X X X Extracts X X X X X X X X Extracts X X X X ..... grounds are raised in these appeals, but they all relate to the chargeability of capital gain on sale of an agricultural land. All the assessees are the co-owners of the agricultural land which was sold during the previous year relevant to the impugned assessment year. For the sake of reference, we take the case of DCIT Vs. J. Vayunandana Rao in ITA No.122 of 2010 as a lead case and narrate the facts of this case as under. 3. The assessee filed the return of income for the impugned assessment year along with a note stating therein that during the year the assessee sold its agricultural land at Kapuluppada village, Bheemunipatnam Mandal of Vizag. Since the land was an agricultural land, no capital gain was shown. It was selected for the sc ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... above mentioned Notification is a stand alone basis for the purpose in question. The view is also fortified by a detailed legal opinion dated 31st May, 2008 ............,a copy of which is filed herewith. The assessee, therefore, submits that the above sale of agricultural land is not exigible to Capital Gains." 4. The A.O. was not convinced with the explanation of the assessee and has levied the capital gain after having observed that though the land was an agricultural land, but it was situated within the 8 kms. from the recently enlarged limit of Greater Visakhapatnam Municipal Corporation. The assessee preferred an appeal before the CIT(A) with the submission that initially the impugned land fall outside the radius of 8 kms. from the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ing the intentions of the charging provisions in view, I decline to accept the contentions of the assessee for want of further Notifications, the above mentioned Notification dated 6.1.1994 is stand alone basis for charging capital gains tax in respect of capital asset under reference". From a plain and reasoned reading of the text of the Explanation - "the reference to municipal limits or the limit of cantonment board in the schedule to this Notification is to the limits as existing on the date on which the Notification is published in the official Gazette", i.e. 1994, and in the absence of any further Notification, and the appellant's cogent reasoning and detailed representations thereon, as against those made by the Assessing Officer, I ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e conclusions drawn. (iii) Whether impugned land is to be treated as urban land or rural agricultural land:- Though the above more or less settle the issue on hand, it is pertinent to address this issue too with reference to jurisdictional situation of the land in question. I agree with the appellant's contention with specific reference to (2009) 25 DTR (Asr)(Trib) 136; (2009) 29 SOT 394 Deputy Commissioner of Income-Tax Vs. Capital Local Area Bank Limited - which discusses "municipality" threadbare and is on all fours squarely to the appellant's case - that Bheemunipatnam Mandal has administrative control on the impugned land rather than the Greater Visakhapatnam Municipal Corporation, as the land revenue and other levies have always ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n agricultural land. Therefore, the CIT(A) has rightly adjudicated the issue. 7. Having heard the rival submissions and from a careful perusal of the record, we find that undisputedly the impugned land was initially situated beyond the 8 kms. from the municipality limit of Visakhapatnam Municipal Corporation. But later on, on incorporation of Greater Visakhapatnam Municipal Corporation, it falls within the 8 kms. from the municipal limit. But no notification as required u/s 2(14)(iii)(b) of the I.T. Act was issued in the Official Gazette by the Central Government. This issue was examined by us in the case of Smt. C. Girija Vs. ACIT (supra) in which we have given a categorical finding that to bring a land within the purview of clause (b) of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ocal limit of the GVMC for which no notification as specified in clause (b) is required to be issued by the central government. We have also examined the contention of the assessees that the GVMC was notified by the local laws and local laws cannot supersede the central laws. But we do not find any force in this argument because the municipality or the cantonment board are subject to local laws and within a state subject and are created by a notification by the state government. Central government has no jurisdiction to create a municipality, cantonment board in any state of the country. Central government is concerned with the central act. Once the municipality of the cantonment board is created by a notification by the state government as ..... X X X X Extracts X X X X X X X X Extracts X X X X
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