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Tota Srinivas Versus The Income Tax Officer, Ward-5 (1) , Hyderabad

2018 (2) TMI 745 - ITAT HYDERABAD

Taxability of gains on sale of lands claimed to be agricultural lands by assessee - nature of land - Held that:- Here the lands in question are away from Municipal limits and cannot be treated as urban lands under W.T. Act or under IT Act. Be that as it may, what is noticed from the ‘agreement of sale-cum-GPA’ and ‘sale deed’ entered by assessee is that assessee never brought the said lands in his name. - The agreement of sale-cum-GPA is from the original owners and assessee sold the same a .....

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lder was only assessee’s right to property. Then, it can also become an ‘adventure in nature of trade’, if the intention is only for subsequent sale on profit. As these aspects are not examined, it is of the opinion that the AO and CIT(A) have erred in treating the same as sale of urban land - set aside the orders of AO and CIT(A) and restore the issue to the file of AO to examine afresh and to determine the nature of transaction - Appeal of assessee allowed for statistical purposes. - I.T.A. No .....

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92,920/-. Due to receipt of information of cash deposits, case was selected under CASS and in the scrutiny, assessee explained the source as sale of lands. The assessment was done u/s. 143(3) of the Income Tax Act [Act] dt. 07-12-2011 by adding an amount of ₹ 21,000/- being interest received on FD/Bank A/c. Thus, assessee s income was determined at ₹ 1,13,920/-. Later, the case was reopened u/s. 147 and AO treated the sale of lands as sale of urban lands u/s. 2(ea)(v) of the Wealth T .....

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ugh assessee has not disclosed any agricultural income, the nature of lands it was claimed, are agricultural lands and so capital gains does not arise. AO rejected the contentions. 3. Aggrieved, assessee preferred an appeal before the Ld.CIT(A) and reiterated the contentions and relied on the judgment of Hon'ble Gujarat High Court in the case of CWT Vs. Shashiben [288 ITR 319] (Guj). Ld.CIT(A), however, rejected the contentions and upheld the order of AO, stating as under: 6. I have carefull .....

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resent case as a whole and an overall view is to be taken in deciding whether the land was an agricultural land, we would come to a conclusion that the property cannot be considered as Agricultural land. Though the circumstances that the land is classified as Agricultural in the revenue records and the Village Panchayat President, Navallur, has certified that the land is away from municipality. In our view the other circumstances pointed out above outweights all of the circumstances in favour of .....

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. 5. Ld.DR, however, submitted that assessee did not do any agricultural operations and the capital gains cannot be treated as agricultural in source. Ld.DR, relied on the following case law: i. Smt. Sarifabibi Mohamed Ibrahim Vs. CIT [204 ITR 631] (SC); [70 Taxman 301] (SC); ii. Union of India Vs. S. Muthyam Reddy [106 Taxman 501] (SC); iii. Chemmancherry Estates Co Vs. ITO [28 SOT 18] (Chennai); iv. Income Tax Officer, IT-I(1), Chennai Vs. Aboobucker [67 taxmann.com 114] (Chennai - Trib); v. G .....

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e land is situated about 35 kms away from municipal limits and the total population of the Dasarlapally village as per the latest census data is 1,844 only. (Copy attached). The land is an agricultural land as defined U/S 2(14) of the Income Tax Act, 1961 and is not a capital asset. The learned DR has filed various case laws, the facts of those cases are not relevant to our case as facts are not identical. We submit our reply for each case separately as under: 1) Smt Sarifabibi Mohamed Ibrahim v .....

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ntioned in section 2(14)(iii)(a) or (b) is an capital asset. 3) Chemmancherry Estates Co vs Income Tax Officer, 28 SOT 18 (Chennai) (URO): In the relevant case the impugned land was not fit for agricultural operations as it was a barren land having no irrigation facilities and was situated in a developed area where industries were coming up and the assessee sold the land to cooperative housing society for construction of houses, and hence the relevant case law is not applicable to the assessee. .....

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was compulsorily acquired by the Government which was situated in the area within the municipality limits of Hyderabad, and hence the relevant case law is not applicable to the assessee. 6) Gopal C Sharma vs Commissioner of Income Tax, 72 Taxman 353 (Bombay High Court). : In the relevant case, the land is not treated as agricultural land as defined U/S 2(14) of the IT Act, 1961 as the same was sold or compulsorily acquired by a Company Larsen & Toubro and hence the relevant case law is not .....

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