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TMI Blog2024 (6) TMI 1061X X X X Extracts X X X X X X X X Extracts X X X X ..... /2017 accepting the return of income. Thereafter, the Assessing Officer observed that the assessee has declared long term capital gain of Rs. 1,65,27,700/- on transfer of agricultural land. Accordingly, he passed a rectification order u/s 154 of the Act to bring the above said capital gain taxable under the book profit assessable u/s 115JB of the Act. 3. It is relevant to observe from the assessment record that the case was selected for limited scrutiny under CASS for the reason of income from heads of income other than business/profession mismatch, sales turn over mismatch and investment in unlisted equities. In the rectification order, the Assessing Officer observed that as per the provisions of Section 115JB of the Act, while computing the book profit for the purposes of MAT, the income exempt u/s 10 other than Section 10(38), Section 11 and Section 12 are to be reduced. He observed that the income earned on transfer of agricultural land is not covered under the provisions of section 10, 11 and 12 of the Act. The income of sale of agricultural land is not taxable under normal provisions of Income Tax Act, at the same is not included in the definition of capital asset as contain ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... T (A) erred in not adjudicating the grounds of appeal on merit." 7. At the time of hearing, the Ld. AR submitted that ground No.1 is not pressed by the assessee. Accordingly, the same is dismissed as such. The other grounds raised by the assessee more or less same as raised before the Ld. CIT(A). 8. The Ld. AR submitted that the Assessing Officer completed the assessment u/s 143(3) of the Act by accepting the return of income after considering the submissions of the assessee. It is important to note that the case was selected for limited scrutiny and the Assessing Officer preferred to issue notice u/s 154 of the Act on the ground that profit on sale of agricultural land was to be included in book profit u/s 115JB of the Act. 9. In response, the assessee submitted that there was no mistake apparent from the record and also the case was selected for limited scrutiny, the Assessing Officer cannot make any addition on other issue which are not the reasons covered in initiating the limited scrutiny. However, the Assessing Officer rejected the same and proceeded to make the addition as per the notice issued u/s 154 of the Act. The Ld. AR submitted that profit on sale of agricultural l ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... as not complied to the various notices issued by the Ld. CIT(A) and Ld. CIT(A) dismissed the appeal of the assessee by observing that the assessee has not filed relevant document in support of its claim and he also dismissed the appeal on merits. 14. We considered remitting the issue back to the file of Ld. CIT(A), however, we observed that there is no dispute as far as the profit earned by the assessee on sale of agricultural land which is exempt from income tax. It is also not in dispute that the Assessing Officer has accepted the income earned by the assessee while assessing tax u/s 143(3) of the Act, however, raised the issue of taxable u/s 115JB of the Act under rectification proceedings. As far as the issue under consideration is whether the profit earned by the assessee which is not a capital assets as per the normal provision of the Act and the same was allow to be claimed under normal provisions of the Act, whether the same income can be charged to tax under MAT. Since, the issue under consideration is very much covered in favour of the assessee. We do not see any reason to remit the issue back to the file of the Ld. CIT(A) and can be disposed off by considering the relev ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ue is decided in favour of the assessee and ground Nos. 2 and 3 are accordingly allowed." Similarly, in the case of ACIT vs. Nilgiri Tea Estate Ltd. in ITA No.377/Coch/2010 dated 29/02/2012, similar issue was considered and decided by the Bench as under:- "3. We have heard the parties, and perused the material on record. The Revenue's stand is that profit or loss on the disposal of an asset is to be duly incorporated in the Profit & Loss Account of a company prepared in accordance with Parts II & III of Schedule VI to the Companies Act, 1956, the net profit per which is to be adopted by it for computing the 'book profit under the MAT provisions, including s. 115JB. As such, there is no basis for excluding the profit derived on the sale of its agricultural land by the assessee. Further, there is no question of the same being exigible for deduction on account of sec. 10 of the Act, which makes no reference to the said income. The assessee, on the other hand, relies on the decision by the tribunal in the case of Harrisons Malayalam Ltd. vs. ACIT (supra), per which the said profit has been held as not liable to book profit tax u/s. 115JB. The Revenue, however, prefers with i ..... X X X X Extracts X X X X X X X X Extracts X X X X
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