TMI Blog2018 (11) TMI 1025X X X X Extracts X X X X X X X X Extracts X X X X ..... r to us that for the period under consideration, in the appeals before us i.e. assessment year 2007-08 & 2009-10 the distance has to be calculated by road and not as the crow flies or by straight line. In this factual and legal matrix of the case, as discussed above, there is no merit in the contention of the revenue. As regards conversion of land from Agricultural use to non agricultural use, the Tribunal in Assessees own case dealt with this issue in paragraph 7.3 to 7.3.10 and held that though the subject land was converted into non-agricultural purposes, cultivation of the land for agricultural purposes till the date of sale continued unabated and as such, the land should be treated as agricultural land. These findings will equally apply for the AYs in these appeals as the character of the land in question remained the same in these AYs also. Respectfully following the decision of the co-ordinate bench of this Tribunal in the assessee’s own case for assessment year 2005-06 and of another co-ordinate bench in the case of Shri M.R.Seetharam in we hold that the said lands in question are not ‘urban lands’ but ‘agricultural lands’ and hence not exigible to wealth-tax. Consequ ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ion 1(b) to section 2(ea) of the Act which defines urban land , as it is situated 11 KMs away from BBMP limits. The Assessees also submitted that conversion of the Agricultural lands does not change the character of the land as Agricultural land so long as the lands continue to be Agricultural land. The assessees also placed reliance on the decision of the ITAT, Bangalore Benches in assessees own case for the earlier assessment year 2005-06 in connection with the view of the AO that BIAPPA (within whose jurisdiction the lands in question were situate) is a local authority. The AO, after considering the assessees submissions concluded the orders of assessment holding that the land is situated within 8 KMs from the BBMP limits in straight line method and further held that the said land falls within the jurisdiction of the newly created administrative authority, i.e. BIAPPA. The AO also held that BIAPPA is an authority akin to a Municipality or Cantonment Board, which has all the power assigned to any local administrative authority and therefore should also be considered to be Municipality for the purposes of tax administration. In that view of the matter the AO brought the aforesa ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... in view of the above, the AO was correct in treating the said lands as urban land and consequently the said lands are liable to be included in the net wealth of the assessees and be exigible to wealth-tax. 4.2 The ld.AR for the assessee placed on record the decision of the co-ordinate bench in the cases of all these assessees before us in WTA Nos.86 to 92/Bang/2014 CO Nos.16 to 29/Bang/2014 at 31/3/2015 for assessment year 2005-06 and submitted that both the issues raised by the Revenue in these appeals have been considered by the Tribunal, which has held that the said lands are agricultural lands and do not partake the character of capital asset as per the Explanation 1(b) to section 2(ea) of the Act. That being so, these lands are not urban lands exigible to wealth-tax. It was submitted that in view of the Tribunal s order (supra), these issues have been decided in favour of the assessee and against revenue. 4.3 In respect of the reliance placed by the ld. DR on the substituted provisions of sub-clause (b) of clause (iii) of section 2(14) of the Income-tax Act, 1961, vide Finance Act, 2013 w.e.f. 01/04/2014 and clarificatory in nature, the ld. AR for the assessee subm ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s to be considered, unless retrospective operation is specifically provided in the statute. In the cases on hand, for assessment year 2007-08 AY 2009-10 the said provisions of sub-clause (b) of clause (iii) of section 2(14) of the Income-tax Act, 1961 have been substituted by the Finance Act, 2013 w.e.f. 01/04/2014 and therefore, are applicable only for and from assessment year 2014-15 onwards; and therefore operate prospectively and cannot be given retrospective operation. The Hon ble Apex Court in the case of Vatika Township Pvt. Ltd. (367 ITR 466) has held that when the Legislature has given the applicability of a section from a particular date, then it is impermissible for the authority to consider the same retrospectively, for earlier years. 5.4 Substitution has the effect of deleting the old rule and making the new rule operative. In common parlance, the word substitute would ordinarily mean to put one in place of another person or thing or to replace or to exchange . Substitution of a provision results in the repeal thereof and its replacement by the new provisions. The process of substitution consists of two steps; the first being that the existing provision/r ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... As regards conversion of land from Agricultural use to non agricultural use, the Tribunal in Assessees own case (WTA No.16 to 29/Bang/2014 CO 86 to 97/Bang/2014) dated 31.3.2015 dealt with this issue in paragraph 7.3 to 7.3.10 and held that though the subject land was converted into non-agricultural purposes, cultivation of the land for agricultural purposes till the date of sale continued unabated and as such, the land should be treated as agricultural land. These findings will equally apply for the AYs in these appeals as the character of the land in question remained the same in these AYs also. 5.7 Respectfully following the decision of the co-ordinate bench of this Tribunal in the assessee s own case for assessment year 2005-06 in WTA Nos.16 to 29/Bang/2014 CO Nos.86 to 97/Bang/2014 at 31/3/2015 and of another co-ordinate bench in the case of Shri M.R.Seetharam in ITA No.1654/Bang/2012, we hold that the said lands in question are not urban lands but agricultural lands and hence not exigible to wealth-tax. Consequently, Revenue s appeals are dismissed. 6.1 In the cross objections (CO) the Assessees have challenged the AO s assumption of jurisdiction by issue of ..... X X X X Extracts X X X X X X X X Extracts X X X X
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