9911796707
TMI Blog2022 (9) TMI 412X X X X Extracts X X X X X X X X Extracts X X X X ..... "1. The learned CIT(A) erred in law and on facts in confirming the addition amounting to Rs.50,51,000/-, being Long term capital gain from sale of Non-agriculture land, such addition is requested to be deleted. 2. The learned CIT(A) erred in law and on facts in confirming the addition amounting to Rs. 1,02,641/-, considering the Agricultural Income as other income, such addition is requested to be deleted. Your appellant prays for leave to add, to alter and/or to amend the above ground before the final hearing of the appeal." 3. The brief facts of the case are that the assessee is an individual who sold his agricultural land on 22-04-2013 bearing survey number 462 of account number 459 at village Chandrala, district Gandhinagar for th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the land was admittedly non-agricultural at the time of sale. Further, since the assessee has not given any details of cost of acquisition and the date of acquisition by the forefathers, the acquisition of said land is taken at "Nil" in the hands of assessee. The long-term capital gains was thus worked out at Rs. 50,51,000/- and the same was taxed in the hands of the assessee. In addition, the agricultural income of Rs. 1,02,641/- which was claimed as exempt in the return of income, was taxed as "income from other sources". 4. In appeal, Ld. CIT(Appeals) dismissed the assessee's appeal on the ground that admittedly the land was converted into non-agricultural land for residential purposes on 04-02-2013 and the same was subsequently sold on ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the income arising from its sale would not be exempt from capital gains tax. The appellant has tried to distinguish the case law relied upon and the decision of Smt. Sarifabibi Mohmed Ibrahim relied upon by the AO. However, these are not relevant in view of the basic fact that the said land was not agricultural land at the time of its sale and during the year under consideration. Therefore, the appellant's arguments in respect of the distance between the land and the closest municipal corporation or the fact that no construction activity had started on the land on the date of sale, do not hold any merit. In view of the detailed discussion above, I am of the considered opinion that as the said land was not an agricultural land and had ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... fit of cost of acquisition for computing capital gains tax. In response, the Ld. DR relied upon the observations made by the Ld. CIT(Appeals) in the appellate order. 6. We have heard the rival contentions and perused the material on record. Regarding the first ground of the assessee in which assessee challenged the additions amounting to Rs. 50.51 lakhs being long-term capital from sale of non-agricultural land, we observe that the honourable Supreme Court in the case of Smt. SarifabibiMohd. Ibrahim v CIT 204 ITR 631 (SC) has held that when the land was not an agricultural land at the time of sale, then the income arising from its sale would not be exempt from capital gains tax. In this case, on 28-3-1958 a portion of said plot was convert ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... in the case of Smt. Sarifabibi Mohd. Ibrahim v CIT 204 ITR 631 (SC) and also the decision of the Ahmedabad ITAT in the case of Shaileshbhai v ITO in ITA number 581/Ahmedabad/2019, we are of the considered view that the Ld. CIT(Appeals) has not erred in facts and in law in disallowing the assessee's claim of capital gains tax exemption on sale of the above land. 6.1 So far as the allowability of the cost of acquisition is concerned, Ahmedabad ITAT in the case of Shaileshbhai v ITO in ITA number 581/Ahmedabad/2019, held that the assessee is entitled deduction of cost of acquisition of the capital asset against the full value of consideration from the transfer of capital asset. The cost of acquisition cannot be treated as "Nil" merely on the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... under the statute. If the assessee failed to furnish the cost of acquisition, then the revenue was empowered to find out the same by exercising the authority provided under the statute under the provisions of section 131/133 (6) of the Act. But we find that the revenue has not exercised such powers." 6.2 Respectfully following the ratio of the above ruling and in the interests of justice, we are restoring the file to the Ld. CIT(Appeals) to adjudicate on the limited point of determining the cost of acquisition, keeping in view the evidence that the assessee may file in support of determining the cost of acquisition. 7. In the result, ground number 1 of the assessee's appeal is partly allowed. Ground number 2: addition of Rs. 1,02,641/- ..... X X X X Extracts X X X X X X X X Extracts X X X X
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