TMI Blog2019 (7) TMI 175X X X X Extracts X X X X X X X X Extracts X X X X ..... e then it amounts to transfer in terms of Section 2(47)(v) (vi). No merit in the contention of the ld AR because of the simple fact that the agricultural land belonging to the Scheduled Caste cannot be transferred to non- Scheduled Caste person until and unless the same is converted to non-agricultural land. Even if the said agricultural land can be transferred in future after converting the same from agricultural to non-agricultural land, it would not be a case of purchase of agricultural land but it must be purchase of non-agricultural land. The moment, the agricultural land is converted to non-agricultural land, it loses the character of agricultural land and consequently the said investment would not be eligible for deduction U/ ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... AO in respect of agricultural land purchased from Sh. Giriraj ( a SC Community person) on the basis of agreement is not entitled to deduction u/s 54B since no legal title has passed to the assessee and therefore, the order passed by AO on incorrect assumption of law is an order which is erroneous and prejudicial to the interest of revenue. 3. The appellant craves to alter, amend and modify any ground of appeal. 4. Necessary cost be awarded to the assessee. 2. The assessee is an individual and filed return of income showing NIL capital gain for the year under consideration after claiming deduction U/s 54B of the Act of ₹ 34,35,418/-. The assessee claimed that out of the sale con ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... eld that once the land in question cannot be transferred by the alleged seller in favour of the assessee due to prohibition of law then the assessee is not entitled for deduction U/s 54B of the Act. Consequently, the order passed by the A.O. was set aside with a direction to the A.O. to pass fresh speaking order after making proper enquiries and affording adequate opportunities. 3. Before us, the ld AR of the assessee has submitted that the AO after considering the Ekrarnama of the purchase of land, the statement of Shri Girraj from whom the land is purchased and considering the fact that the registration / sale deed of land has not been executed in favour of the assessee, allowed the claim u/s 54B since the seller has hand ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nsferring, or enabling the enjoyment of any immovable property. Thus, when the purchase of land is effected by way of a notarized agreement, full consideration has been paid and the property is being enjoyed by the assessee, the same would constitute transfer under the Act. Without prejudice to the above, when the Ld. CIT has held that the deduction allowed by the AO u/s 54B is based on mistaken view of law / erroneous application of the provisions of the Act then he should have directed the AO to disallow the claim instead of setting aside the order to AO for making proper enquiries without specifying as to what enquiry he should make and ignoring that AO has already made the enquiries while allowing the claim of deductio ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... o the reason that the agricultural land could not be transferred by the seller in favour of the assessee as prohibited by the law. However, the assessee has claimed that once the assessee has paid the consideration and the possession was handed over to the assessee then it amounts to transfer in terms of Section 2(47)(v) (vi) of the Act. We do not find any merit in this contention of the ld AR because of the simple fact that the agricultural land belonging to the Scheduled Caste cannot be transferred to non- Scheduled Caste person until and unless the same is converted to non-agricultural land. Even if the said agricultural land can be transferred in future after converting the same from agricultural to non-agricultural l ..... X X X X Extracts X X X X X X X X Extracts X X X X
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