TMI Blog2016 (12) TMI 610X X X X Extracts X X X X X X X X Extracts X X X X ..... d by the approach road. The amendment brought in by the Finance Act, 2013 to measure the distance aerially is effective from 01- 04-2014 and therefore, applies prospectively in relation to the assessment year 2014-15 and subsequent assessment years. we find that the matter require fresh examination taking into consideration the above legal proposition. We accordingly, set-aside the matter to the file of AO to examine the matter a fresh after giving reasonable opportunity to the assessee. - Decided in favour of assessee for statistical purposes only. - ITA No. 372/JP/2015 - - - Dated:- 1-12-2016 - SHRI KUL BHARAT, JM SHRI VIKRAM SINGH YADAV, AM For The Assessee : Shri P.C. Parwal (CA) For The Revenue : Sh. Prem Prakash Meena (JCIT) ORDER PER SHRI VIKRAM SINGH YADAV, A.M. This is an appeal filed by the assessee against the order dated 26/02/2015 of the learned CIT(A)-II, Jaipur for A.Y. 2011-12. The sole ground of appeal raised by the assessee is as under:- The ld CIT(A) has erred on facts and in law in confirming the action of A.O. in holding that the agricultural land sold by the assessee is a capital asset within the meaning of Section 2(14)(iii ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... as inserted that the impugned land was more than 10 kms from the municipal limits of Jaipur Nagar Nigam, Jaipur. This issue is discussed at length in the show cause notice issued as such the assessee is guilty of furnishing fabricated documents to defraud revenue during the course of scrutiny assessment proceedings. (vi) The reports received from the Tehsildar Sanganer and Tehsildar Nagar Nigam Jaipur ore scanned in assessment order:- (vii) The assessee was owner of 3-4 residential flats constructed at 75 Sunder Nagar, Malviya Nagar, Jaipur and was also owner of a number of other plots as mentioned in the Balance Sheet out of which some are residential houses as such the assessee was having more than one residential house as on the date of transfer of original asset. Accordingly, the assessee was not eligible for claiming deduction u/s 54 F of the Income tax Act, 1961. (viii) The assessee has not taken possession of the flat booked in Garden View apartment within the allowed period as such otherwise also the investment made in flat is not eligible for claiming deduction u/s 54 F of the Income tax Act, 1961. (ix) The assessee has also purchased a residential ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... a distance of 8 kms from the Municipal limit. In view of the above reports given by the revenue authorities, it is held that the impugned land was situated within a distance of 8 kms from the Municipal limit (in fact only 2.5 kms away) and therefore is a capital asset in view of the provisions of section 2(14)(iii)(b). Therefore, the stand of the Assessing Officer in holding that this agricultural land is a capital asset, is upheld. Ground no.3 (i) is dismissed. 4. Now the assessee is in appeal before us. The ld AR of the assessee has submitted that the assessee sold an agricultural land at Village Saligrampura, Tehsil Sanganer on 21.09.2009 for ₹ 87,40,000/-. For stamp duty purpose, its value was assessed at ₹ 89,47,500/-. The AO obtained report from Tehsildar Sanganer who reported that the land sold is situated at 2.5 kms of the Municipal limits. Report is also obtained from the office of Nagar Nigam, Jaipur where it was stated that the land sold by the assessee is 5 kms of the Municipal limits. Accordingly, the AO held that the agricultural land sold by the assessee is a capital asset u/s 2(14) of the Act and determined the long term capital gain at ₹ 75 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... as existing on the date of notification dated 06.01.1994 and by the approach road and therefore, the matter should be set aside to the AO to get these facts verified from the Tehsildar/ Nagar Nigam and thereafter determined whether the agricultural land sold is a capital asset or not in terms of section 2(14) of the Income Tax Act, 1961. Therefore, he prayed to allow the appeal of the assessee. 5. At the outset, the ld DR has vehemently supported the order of the ld CIT(A). 6. We have heard the rival contentions of both the parties and perused the material available on the record. In the instant case, the assessee sold an agricultural land at village Salingrampura, Tehsil- Sanganer, district- Jaipur on 21/09/2009. The revenue held that the agricultural land sold is a capital asset u/s 2(14) of the Act as it is within 8 KM from the municipal limit whereas the assessee s argument is that this limit is to be reckoned from the date of notification dated 06/1/1994. Further on 21/09/2009 whether when the agricultural land was sold, there was no direct approach from village Murlipura to village Salingrampura. 6.1 To appreciate the controversy, it will be appropriate to refer to ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... and other relevant considerations, notified by the Central Government in this behalf. The effect of the proposed amendment will be that capital gains arising from the transfer of agricultural land situated in municipal or other urban areas or notified adjoining areas will be liable to income-tax for the assessment year 1970-71 and subsequent years....... Agricultural land which is situated outside such municipal or other urban areas or the notified adjoining areas will, however, continue to be excluded from the term capital asset and no capital gains tax will be payable with reference to the transfer of such agricultural land, as hitertho. 6.3 In context of section 2(14)(iii)(b) of the Act, we now refer to the notification dated 6th January, 1994, issued by the Central Government reported in 205 ITR (St.) 121, the relevant extracts reproduced as under: Now, therefore, in exercise of the 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 Income-tax Act, 1961 (43 of 1961), and in supersession of the notification of the Government of India in the erstwhile ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the local limits of municipality or other local bodies mentioned therein as specified in the notification issued by the Central Government. As per sub-clause (b) of clause (iii) of Section 2(14), the notification of the Central Govt. is therefore mandatory to bring the land in the definition of capital asset which is not located within the limits of the Municipality but located within the distance of 8 kms from the local limits. 6.5 We now refer to the decision of the Coordinate Bench in case of Smt. (Dr.) Subha Tripathi (supra) which has been relied upon by the ld AR. The operative part of the decision is reproduced as under: 2.7 We have considered the rival submissions as well as the materials on record. The question arises for our consideration and adjudication is whether the land in question though located beyond 8 kms from the Municipal Limits of Jaipur Municipality as on the date of notification dated 06-01-1994 but subsequently it falls within the distance of 8 kms from the Municipal Limits due to the expansion of the Municipal Limits would still be regarded as agricultural land not falling in the definition of capital asset in terms of Section 2(14)(iii)(b) of the A ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... istance of 8 kms from Municipal Limits. There is no amendment or withdrawal of the said notification except a recent amendment has been brought in the statute by the Finance Act 2013 whereby the requirement of said notification has been dispensed with for invoking sub-clause (b) of clause (iii) of Section 2(14) of the Act w.e.f. 01-04-2014. Thus it is discernible from the notification dated 06- 01-1994 and the recent amendment in the statute whereby the said notification has been dispensed with that the distance of 8 kms has to be considered from the Municipal Limits as exists on the date of notification for the purpose of invoking sub-clause (b) of clause (iii) of Section 2(14) of the Act. Accordingly we hold that the land in question which was located beyond 8 kms from the Municipal Limits as on 6-01- 1994 when the notification was published in the official gazette, the same would fall under the exclusion clause of the term 'capital asset' as per provisions of 2(14)(iii)(b) of the Act. 6.6 The Coordinate Bench while delivering the above decision has referred to the decision of the Hon ble Karnataka High Court in case of CIT v. Madhukumar N. (HUF) [2012] 208 Taxman 3 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... lls under mischief of subclause (b) of Section 2(14)(iii) of the Act, the distance of 8 kms has to be taken into account in terms of notification dated 6-01-1994. As per explanation 2 of the said notification dated 6-01-1994, the Municipal Limits is to be the limits as existing on the date on which the notification is published in the official gazette. There is no amendment or withdrawal of the said notification except the amendment brought in the statute by the Finance Act 2013 whereby the requirement of said notification has been dispensed with. The amendment by the Finance Act 2013 is with effect from 01-04-2014 and therefore, applies prospectively in relation to the assessment year 2014-15 and subsequent assessment years. 6.8 Regarding the issue about measurement of distance, the contention of the Ld AR is that there was no direct road from Murlipura to Gram Salimgrampura and that the distance is to be measured by the approach road. The issue is no more rest integra and is fairly settled now. For the year under consideration, the distance has to be measured by the approach road. The amendment brought in by the Finance Act, 2013 to measure the distance aerially is effective f ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ttained finality. Keeping in view the principle of consistency as laid down in Radhasoami Satsang v. CIT [1992] 193 ITR 321 1 (SC) we are of the view that the opinion expressed by the Tribunal does not suffer from any legal infirmity warranting interference of this Court. Accordingly question No. 1 is answered against the Revenue and in favour of the assessee by upholding the order of the Tribunal. 6.9 Further, we refer to the decision of the Hon ble Bombay High Court in case of Commissioner of Income-tax, Nagpur v. Nitish Rameshchandra Chordia [2015] 57 taxmann.com 394 (Bombay) where the Hon ble High Court has held as under: 15. Insofar as relevance of Section 11 of the General Clauses Act is concerned, it needs to be noted that here the relevant amendment prescribing distance to be counted must be aerial has come into force w.e.f. 1st April, 2014. The need of amendment itself shows that, in order to avoid any confusion, the exercise became necessary. The Parliament noticed the Judgments being delivered and therefore, emphatically pointed out aerial distance as the relevant norm. This exercise to clear the confusion, therefore, shows that benefit thereof must be given ..... X X X X Extracts X X X X X X X X Extracts X X X X
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