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TMI Blog1987 (4) TMI 59X X X X Extracts X X X X X X X X Extracts X X X X ..... instance of the Revenue, referred to us by the Income-tax Appellate Tribunal, Cochin Bench: " Whether, on the facts and in the circumstances of the case, the Tribunal is right in law and has jurisdiction to hold that the land in question' is not a capital asset within the meaning of the definition ' ?" In the assessment year 1974-75, the Income-tax Officer added a sum of Rs. 1,31,525 as capital ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... was not acquired in 1964, but in the relevant accounting year when the award was made. This finding has not been challenged by the assessee. The Tribunal, however, noticed that the Bombay High Court had in Manubhai A. Sheth v. N. D. Nirgudkar, IInd ITO [1981] 128 ITR 87 held (p. 121): " ... capital gains made on sale of land situate in India, which land is used for agricultural purposes, would b ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Act. But the fallacy of that assumption is that, when land is sold, the sale proceeds do not constitute revenue but capital : (Commr. of Agrl. I.T. v. Kailas Rubber & Co. Ltd. [1966] 60 ITR 435 (SC) and Vishnudatta Antharjanam v. Commr. of Agrl. LT. [1970] 78 ITR 58 (SC). The profits or gains arising from the sale of land constitute income because section 2(24) of the Act includes as " income " c ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... D. Nirgudkar, IInd ITO [1981] 128 ITR 87 to the contrary. We are fortified in this conclusion by the decisions in Ambalal Maganlal v. Union of India [1975] 98 ITR 237 (Guj), Jayachandra v. ITO [1986] 161 ITR 190 (Kar) and CIT v. Rajendrappa [1986] 162 ITR 666 (Kar). In the circumstances, we have no doubt that the sale proceeds constituted capital receipt and not revenue receipt. The question refe ..... X X X X Extracts X X X X X X X X Extracts X X X X
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