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2017 (1) TMI 719 - ITAT PUNE

2017 (1) TMI 719 - ITAT PUNE - TMI - Assessability of gain arising on sale of agricultural land - whether the same is exempt from tax? - measurement of distance for the purpose of deciding the character of land - Held that:- The first issue as to whether any agricultural activity is being carried out or not has been elaborately considered by the CIT(A) and he has given finding that the entries in 7/12 extract evidenced the cultivation of land and the same remained uncontroverted. The Revenue bef .....

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by a straight line distance or horizontal plain or as per crow’s flight. The Talat hi in the certificate has certified that the distance from municipal limits was about 13 kilometers i.e. beyond eight kilometers. Accordingly, we uphold the order of CIT(A) in holding that the gain arising from sale of agricultural land is not to be taxed in the hands of assessee. Upholding the same, we dismiss both the grounds of appeal raised by the Revenue. - Decided in favour of assessee. - ITA Nos. 108 to 11 .....

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t the request of the assessee. On the appointed date of hearing, none appeared on behalf of the assessee nor any application was moved for adjournment. We proceed to decide the appeals after hearing the learned Departmental Representative for the Revenue. 3. All the appeals filed by the Revenue relating to connected assessee on identical issue were heard together and are being disposed of by this consolidated order for the sake of convenience. However, reference is being made to the facts and is .....

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and has also not shown any agricultural income in his return of income filed. 2. Whether on the facts and circumstances of the case and in law, the CIT(A) was justified in measuring the distance in terms of approach road by ignoring the provisions contained in Sec. 11 of the General Clauses Act which clearly specifies that unless a different intention appears, distance has to be measured in a straight line on a horizontal plane. The said provisions are mandatorily applicable to the Income Tax Ac .....

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land situated at Gat No.116, Village Mouje Chandkhed and the long term capital gain arising on sale of said agricultural land was claimed as exempt. The Assessing Officer in order to verify exact location of plot of land in question wrote a letter to the Asst. Director, Town Planning Pune Branch, Pune and requested to furnish exact location of the land and the aerial distance from municipal limits of PMC/PCMC. In response thereto, vide letter dated 05.12.2009, it was reported that the plot of la .....

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er the plot of land could be characterized as agricultural land. In support of its claim, the assessee produced copy of 7/12 extract but the same was rejected by the Assessing Officer for the following reasons:- 5.6 The assessee's submission is carefully considered. However, I am not inclined to accept the explanation submitted by the assessee for the following reasons: (1) The Plot of lands sold by the assessee in question situate in a pre-dominant developed area and its physical characteri .....

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eing grass grown) and no other major crops were grown or cultivated. Copy of 7/12 extract is enclosed as Annexure-II with this order for better appreciation of the facts. (4) The 13th test lays out that -" Whether an agriculturist would purchase the land for agricultural purposes at the price at which the land was sold and whether the owner would have ever sold the land valuing it as a property yielding agricultural produce on the basis of its yield- The a n sw e r to this te st is d e fin .....

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In view of the above facts, it is crystal clear that the plots of land sold by the assessee is situated in the predominant developed area and it did not fulfilled the test laid down by the Hon'ble Supreme Court in case of Sarifabibi Mohmed Ibrahim And Other. Vs Commissioner of Income-Tax 204 ITR 631. Therefore, the plots of land sold by the assessee are characterized as "Capital Asset" as defined in section 2(14) of the I T Act, 1961 and as such assessee is liable to pay Long Term .....

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exempt by the assessee is brought to tax under the head "Long Term Capital Gain". Penalty proceedings u/s 271(1)(c) is initiated separately for filing inaccurate particulars of income. 7. The Assessing Officer obtained the Valuer s report from the DVO as on 01.04.1981 and confirmed the income from long term capital gains. 8. Before the CIT(A), the assessee filed detailed submissions as well as additional evidence in respect of certificate from Talat hi regarding the distance of plot i .....

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pages 5 and 6 of the appellate order. The assessee in reply explained the sequence of events which is reproduced under para 7 along with his submissions at pages 8 and 9 of the appellate order. The CIT(A) noted that the assessee was confronted with the Town Planning Report on 10.12.2009 and the assessment was completed on 22.12.2009, therefore, there was justification in the grievance of assessee that he was prevented by sufficient opportunity. The CIT(A) also noted that the Assessing Officer h .....

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ve, it is seen that in the year 2002, 2003 & 2004, major part of land has been shown as Gras land (Gavat) i.e. 10.73H. Thereafter, the Gavat land has been shown at 1.73 H and rest of the land has been shown under various crops as stated above. As far as Gavat land is concerned, the appellant submits that this is not the barren grass land but animal feed grass land which is used as a cattle feed. From the extract of 7/1 2, it is seen that major part of the land i.e. 10.7 3 has been under gras .....

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It is also seen that the Assessing Officer had not examined as to how the cultivation was carried out by the appellant. Whether the same was carried out by the appellant himself or by some other person employed for this purpose. No such details have been brought on record in this regard. The Assessing Officer could have very well proved the same, had he examined the issue in detail on the above lines. However, despite giving the opportunity in the remand order, the Assessing Officer has failed t .....

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the land was held to be agricultural land. Vis-à-vis, the distance issue, the CIT(A) vide para 11 has held as under:- 11. As far as the distance issue is concerned, it is seen that the Assessing Officer has asked the Asstt. Director Town Planning Department to provide aerial distance from the Municipal limits. It is settled law that the distance is to be measured in terms of approach road. In the case of CIT Vs. Satinder Pal Singh, 229 CTR 82, Hon ble Punjab & Haryana High Court has h .....

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hat the Assessing Officer was not justified in taxing the sales consideration in respect of plot of agricultural land as Capital Gains. Accordingly, the Assessing Officer is directed to delete the addition of 70,16,335/-. In view of relief allowed as above, the question of valuation of land as on 01.04.1981 has become academic and therefore the same is not being adjudicated. 10. The Revenue is in appeal against the order of CIT(A) on both the issues. 11. The first issue as to whether any agricul .....

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