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TMI Blog2016 (6) TMI 1425X X X X Extracts X X X X X X X X Extracts X X X X ..... to and ask for submission of remand report instead of directing to verify whether the subject land falls within the municipal limits or HADA limits. 4. The learned CIT(A) Ought to have observed that the subject land was sold for the purpose of non-agricultural usage i.e construction of building, since in normal course, there should be a Government Order for such conversion of agricultural land into non-agricultural purposes like construction activities and without such verification, deciding the said land as agricultural land is erroneous on the part of the learned CIT(A). 5. The 'learned CIT(A) ought not have restricted the jurisdiction of the AO by calling of remand report only on the issue of measurement of distance from GHMC or HADA limits instead of giving power to examine the issue a fresh and submit report keeping in view of the Apex court observations as held in the above mentioned cases. 6. Since, the core issue is missed out from the hands of the fact finding authorities i.e Assessing Officer and Commissioner 0 income tax (Appeals), the honorable Tribunal is requested to remit back to the file of the AO to verify the issue raised in ground NO.1 here. 7. Any ot ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tification. Therefore, the said sale transaction attracts Short Term Capital Gain Tax. The said transfer of land took place on 29.10.08 and 23.12.08 which is subsequent to the date of notification. The issue is clearly analysed to the assessee's AR and confronted with the GHMC notification. The assessee has not furnished the copies of the sale deeds for the purchase cost in respect of the above transactions. On verification of the details of the market value of the land for the calendar year 2006, the market value per gunta was at Rs. 50,000. Accordingly the cost price is worked out and determined the Short Term Capital Gain at Rs. 76,12,500/-". 3. Before the learned CIT (A), submission of the assessee read as follows: "The Assessee sold the lands located in Mamidipally Village, Saroornagar Mandai the particulars of which are as follows - 1. Document NO's.4767/2008 - 15 Guntas - Sale Consideration Rs. 20,62,500/-. 2. Document No's. 4197/2008 - 1.2 Acres - Sale Consideration Rs. 52, 50, 000/-. 3. Document No's.4766/2008 - 12 Guntas - Sale Consideration Rs. 6, 00,000/-. These lands were purchased in the year 2006 and being Agriculture lands on which agriculture ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... whether the assessee's land situated at Mamidipally Village located within 8 Kms radius of GHMC or any other municipality in terms of section 2(14)(iii)(b). 5. AO in his remand report observed that: "The assessee filed a letter stating that the said viillage was not part of GHMC and in this regard he filed GO No.261 dated 16.4.2007 as per which the Mamidipally was one of the eight gram panchayats proposed to be enclosed in GHMC. However as per paras no.10 and 11 as well as the notification enclosed to the GO, Mamidipally village has not been included in the jurisdiction of GHMC. He has filed copy of "Memo" issue by the Deputy Collector & MRO, Saroornagar Mandal wherein the Dy. Collector and MRO stated that the MamidipallY village is a Grampanchayath and neither a municipality nor falls within 8. K. M. radius of any nearest municipality. The submissions made by the assessee are not acceptable. It is pertinent to mention here that the impugned land was situated in the vii/age Mamidpally and Saroornagar MandaI, which is included in the Hyderabad Airport Development Authority (HADA), vide GOMS 352 MA dtd. 30. 07. 2001. The HADA has been constituted as a Special Area Development A ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rt and the assessee had made the following submissions: " The learned Assessing Officer has relied on the definition of a Capital assets which has been defined as follows - "Capital asset" means property of any kind held by an assessee, whether or not connected with his business or profession, but does not include-agricultural land in India, not being land situate- (a)' in any area which is comprised within the jurisdiction of a municipality (whether known as a municipality, municipal corporation, notified area committee, town area committee, town committee, or by any other name) or a cantonment board and which has a population of not less than ten thousand according to the last preceding census of which the relevant figures have been published before the first day of the previous year] ; or In this regard the Assessee humbly submits that Government in G.O.Ms. No 352 MA&UD (I) Department., dated 30-7-2001 have declared the area comprised within the jurisdiction of Shamsabad and surrounding villages in Ranga Reddy District to be a Special Development Area called as Hyderabad Airport Development Area (HADA). HADA has been notified by brining into its ambit about 458 sq. km ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... wn in the constitution, and has to be so notified by the Government whereas setting up of a Development! Special Area Authority is not mandatory. Generally understood, 'municipality' means a legally incorporated or duty authorised association of inhabitants of a limited area for local governmental or other public purposes. The council consists of such number of members as are prescribed. They are called councillors. They are elected by the residents of the area coming within the jurisdiction of the municipality. The chairman and vice-chairman of the municipality are elected by the members of the council. The commissioner is appointed by the Government in consultation with the council. It is the duty of the commissioner to carry into effect the resolutions of the council unless it be that the said resolution is suspended or cancelled by the Government. The municipality contemplated under section 2(14)(iii) (a) must be one which satisfies the above requirements. Hence all the local authorities must satisfy the above requirements to be known as a 'Municipality'. HADA is basically and essentially a creation of the Act of State Legislature consisting of persons appoi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... hority created under the Act, by itself, would not constitute a distinct municipality or any other local authority. In the instant case, the village Mamidipalli in which the agricultural land was located was comprised in the area within the jurisdiction of Gram Panchayat and as such the Special Area Authority, being HADA, shall be deemed to be such Gram Panchayat, to the extent of execution of the delegated function of granting technical approval for constructions development of layouts. The Agriculture Land at Mamidpalli does not fall within any area which is comprised within the jurisdiction of a municipality or cantonment board or which has a population of not less than 10,000 since as per the latest Census as per the GO the population of the Village is only 3494 which have been duly published in the GO referred above. Hence the land does not fall in sub-clause (a) of section 2(14)(iii) of the Act as me land is outside of any municipality including GHMG. The Land sold by Assessee also does not fall under clause (b) of section 214)(iii) which prescribes that any area within such distance, not being more than 8 km from the local limit of any municipality or cantonment board ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d by the assessee also does not fall within such distance of not being more than 8 km from the local limit of any municipality or cantonment board as referred to in sub-clause(b) of section 2(14)(iii) as the lands covered under HADA are more than 21 Kms from the Municipal areas i.e. GHMC Hyderabad. The learned CIT (A) being appraised by the assessee also adhered to the rationale adopted by the ITAT Hyderabad Bench "A" in the case of Smt. T. Urmila vs. Income Tax Officer Ward 6(2) in appeal No.398/Hyd/2012 for the A.Y 2008-09, dated 12th December, 2012 which has held that lands falling within the HADA cannot be construed as land within the Municipal Limits. Accordingly the learned CIT (A) allowed relief to the assessee declaring the said land as agricultural land and that they do not fall within the capital asset as defined u/s 2(14)(iii) of the Act. Being aggrieved, the Revenue has brought out this appeal before us. The learned DR relied on the order of the AO, whereas the learned AR submitted various submissions as done before the first appellate authority and relied on the order of the CIT (A). The learned AR further pointed out before us the decision of the Hyderabad Bench "A" i ..... X X X X Extracts X X X X X X X X Extracts X X X X
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