9911796707
TMI Blog2022 (12) TMI 631X X X X Extracts X X X X X X X X Extracts X X X X ..... ral land exempt from capital gains tax. For this, the Revenue has raised the following grounds No.2 to 2.5: "2. The CIT(A) erred in deleting the addition made by the Assessing Officer of Rs 18,58,00,000/- u/s 2(47) r.w. section 45. 2.1. The CIT(A) erred in not appreciating the contention of the AO that the land sold is not an agricultural land thereby falling within the definition of Capital Asset u/s 2(47) r.w.section 45. 2.2 The CIT(A) failed to note that the assessee has not filed the conveyance deed for acquiring as well as for disposal of the impugned lands before the AO either during the assessment proceedings or when the issue was remanded to the AO. 2.3 The CIT(A) failed to note that the conditions stipulated in section 2(14) cannot be established unless the particulars of the land are known. 2.4 The CIT(A) failed to appreciate that the assessee did not produce any documentary evidence for the agricultural activity carried out by the assessee, sale of agricultural produce etc. 2.5 It is verified from the returns filed by the assessee that the assessee company has not offered agricultural income for the AYs 2009-10, 2010- 11, 2011-12 and in this assessment year a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the profit arising out of the sale of this property as capital gain u/s. 2(14) r/w s. 45 of the Act by observing as under: "Thus, on examination of facts in this ease, it is clear that on the date of sale, the agricultural operations were in fact, not at all carried on the hind. Moreover, the assessee has failed to substantiate his claim with documentary evidence fur agricultural operations in fact earned on the said lands and proof of sale of agricultural produce etc. The profit on sale of land should have been credited .to profit and loss account, even if the assessee wants to claim any exemption from tax. The book depreciation chart also does not reveal whether this asset is included in the WDV of hand. Further, there is no break-up and details for Long term capital assets and short term capital assets. The assessee has not produced any documentary evidence in support of their claim despite specifically calling for vide this office letter u/s. 142(1) dated 09.01.2015 and also during the course of assessment proceeding. Moreover, no agricultural income was admitted in the return of income to claim that "electrical goods manufacturing company" has been carrying on the agricult ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... The appellant also furnished the Chitta Adangal in connection with the land in support of their claim that lands were indeed agricultural in nature. The additional evidence furnished in the course of appellate proceedings was forwarded to the Assessing Officer for his comments. The Assessing Officer in his remand report dated 25.01.2017 reiterated his stand stating that no documentary proof for the agricultural activity carried out during the relevant period was furnished by the appellant were not sufficient to establish that the land is agricultural in nature. 4.4.1. The Hon'ble Supreme Court in the case of Smt. Sarifabibi Mohamed Ibrahim v. CIT (204 ITR 361)(SC) declared as under: Whether a land is an agricultural land or not is essentially a question of fact. Several tests have been evolved in the decisions of the Supreme Court and the High Court, but all of them are more in the nature of guidelines. The question has to be answered in each case having regard to the facts and circumstances of that case. There may be factors both for and against a particular point of view. The Court has to answer the question on a consideration of all of them a process of evaluation. The infe ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... hala Vedachalam v Asst Commissioner (369 ITR 558) (Mad) declared that where the classification of lands as per the revenue records are agricultural lands, which are evidenced by the adangal and the letter of the Tahsilar and satisfies other conditions of section 2(14) then the assessee was liable to be exempted from capital gain tax. This view was further fortified by the jurisdictional High Court in the case of CIT v Mansi Finance Chennai Ltd (388 ITR 514)(Mad.) wherein it was observed that where a land has been classified as agricultural land and such land was not converted into non-agricultural land prior to its sale then it can be concluded that the land retained its character as agricultural land till the time of the sale. After a cumulative consideration of all the relevant facts as above, I hold that the land in question has to be treated as agricultural land for the purposes of v Section 2(14) and the appellant is not liable for any capital gains tax on the sale. The addition of Rs.18,58,00,000/- made by the Assessing-Officer in this regard is deleted. The appellant succeeds on this ground." Aggrieved, the Revenue is in appeal before the Tribunal. 6. We have heard rival ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ified by us, which are not contradicted by ld. CIT-DR. It means that the assessee has declared agricultural income varying from Rs.25,000/- to Rs.1,80,000/- and as per revenue records, the assessee has grown crops in the land and earned some agricultural income. The assessee is able to prove that the land is kept for agricultural activity and it has actually carried out agricultural activity, as the evident shows. In view of these facts and circumstances, we are of the view that the CIT(A) has rightly treated this land as agricultural land and held that the same is not assessable to capital gains. We affirm the findings of CIT(A) on this issue and Revenue's appeal is dismissed. C.O.No.109/CHNY/2017 7. Coming to cross objection of the assessee, the first effective issue is as regards to the order of CIT(A) partly sustaining the addition u/s.43B of the Act towards service tax of Rs.2,33,237/-. 8. We have heard rival contentions on this issue and gone through facts and circumstances of the case. The ld.counsel for the assessee before us submitted that the matter can go back to the file of the AO for verification, whether the assessee has paid this amount or not within the due date, ..... X X X X Extracts X X X X X X X X Extracts X X X X
|
