TMI Blog2019 (9) TMI 717X X X X Extracts X X X X X X X X Extracts X X X X ..... llow the claim of assessee though not made in the return of income. It may be pointed herein itself that even the income from sale of agricultural land as either Long Term Capital Gains or Short Term Capital Gains, was never offered by assessee in its return of income. Assessing Officer computing income from capital gains in the hands of any assessee, then it is his duty not only to compute income under the respective heads but also to allow exemptions which are duly allowable to the assessee. CIT(A) had in all fairness directed the Assessing Officer to verify whether the assessee has fulfilled the conditions laid down in section 54B and had further observed that in case they are not so fulfilled, then no deduction under section 54B is t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 3. The issue raised in the present appeal filed by Revenue is against allowability of deduction claimed under section 54B of the Act. 4. Briefly, in the facts of the case, the assessee as individual had furnished original return of income declaring total income of ₹ 4,89,780/- and agricultural income of ₹ 3,65,06,625/-. The case of assessee was picked up for scrutiny. The Assessing Officer noted that the assessee had shown profit of ₹ 3.60 crores on sale of agricultural land and claimed the same as exempt. On verification of sale deed, it was noted that the lands were situated at Saswad, Akhatpur Village, near Saswad and Kumbhoshi Village. The Assessing Officer sought information from S ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 5. The CIT(A) noted the plea of assessee and observes that where the assessee had not disclosed any income from capital gains in the return of income, then there was no basis for not allowing legitimate claim of deduction under section 54B of the Act, if otherwise all the conditions had been fulfilled by assessee. The CIT(A) in turn, relying on the ratio laid down by the Hon ble Bombay High Court in CIT Vs. Pruthvi Brokers Shareholders reported in 349 ITR 336 (Bom) held that exemption under section 54B of the Act claimed during assessment proceedings should be allowed. However, in order to verify whether the assessee had fulfilled all the conditions as prescribed in section 54B of the Act, the said issue for examination was remitted back ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... return of income. The Assessing Officer sought information from the Municipal authority and since the land sold by assessee was within 8 Kilometers from the Municipal limits, the Assessing Officer held that gain arising from the sale of agricultural land was taxable in the hands of assessee and computes the income from Long Term Capital Gains and Short Term Capital Gains. However, the claim of assessee during assessment proceedings in allowing the benefit of deduction under section 54B of the Act i.e. on account of investment in new agricultural land was denied to the assessee on the ground that no such claim was made in the return of income and hence, not allowable as per the ratio laid down by the Hon'ble Supreme Court in M/s. Goetze ..... X X X X Extracts X X X X X X X X Extracts X X X X
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