ITO, New Delhi V. M/s. Neon Properties (P) Ltd., New Delhi

ITA 1172/DEL/2011

• Counselvise Citation: [2011] 134 COUNSELVISE.COM (IT) 3976 (ITAT-DELHI)
• Duration Of Justice: 2 month(s) 9 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 13-05-2011
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: E
• Next Hearing Date: 10-05-2011
• Assessment Year: 2005-2006
• Appeal Filed On: 04-03-2011
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: RAJ TONDON
• Assessee Lawyers: V K JAIN
• Keywords: Business income; Source of fund; Cost of acquisition

Judgement Text

ITA NO. 1172/DEL/2011 1 IN THE INCOME TAX APPELLATE TRIBUNAL DELHI BENCH E NEW DELHI BEFORE SHRI RAJPAL YADAV, JUDICIAL MEMBER AND SHRI SHAMIM YAHYA, ACCOUNTANT MEMBER I.T.A. NO. 1172/DEL/2011 A.Y. : 2005-06 INCOME TAX OFFICER, WARD 13(2), C.R. BUILDING, NEW DELHI VS. M/S NEON PROPERTIES (P) LTD., 108, ANSAL BHAVAN, 16, K.G. MARG, NEW DELHI 110 001 (PAN/GIR NO. : AAACN0229M) (APPELLANT ) (APPELLANT ) (APPELLANT ) (APPELLANT ) (RESPONDENT ) (RESPONDENT ) (RESPONDENT ) (RESPONDENT ) ASSEESSEE BY : SH. V.K. JAIN, CA DEPARTMENT BY : SH. RAJ TONDON, C.I.T. (D.R.) ORDER ORDER ORDER ORDER PER SHAMIM YAHYA: AM PER SHAMIM YAHYA: AM PER SHAMIM YAHYA: AM PER SHAMIM YAHYA: AM THIS APPEAL BY THE REVENUE IS DIRECTED AGAINST TH E ORDER OF THE LD. COMMISSIONER OF INCOME TAX (APPEALS) DATED 2.11.2 010 PERTAINING TO ASSESSMENT YEAR 2005-06. 2. THE GROUNDS RAISED READ AS UNDER:- THAT ON THE FACTS AND CIRCUMSTANCES OF THE CASE AND IN LAW, THE LD. COMMISSIONER OF INCOME TAX (APPEALS) HAS ERRED I N DELETING THE ADDITION MADE BY THE ASSESSING OFFICER AND FAIL ED TO APPRECIATE THE FACT THAT THE MAIN OBJECT OF THE ASSE SSEE COMPANY IS TO DEAL IN PROPERTIES AND THE LAND SOLD BY IT I S PART OF ITS BUSINESS ACTIVITY. ITA NO. 1172/DEL/2011 2 THAT ON THE FACTS AND CIRCUMSTANCES OF THE CASE AN D IN LAW THE LD. COMMISSIONER OF INCOME TAX (APPEALS) HAS FAILED TO APPRECIATE THE FACT THAT THE LAND WAS ACQUIRED BY T HE ASSESSEE TO EARN PROFIT OUT OF IT AS PER ITS MAIN OBJECT OF THE BUSINESS AND NOT FOR LONG TERM INVESTMENT. THAT ON THE FACTS AND CIRCUMSTANCES OF THE CASE IN L AW THE LD. COMMISSIONER OF INCOME TAX (APPEALS) HAS FAILED TO APPRECIATE THE FACT THAT THE LAND HAS BEEN TREATED AS STOCK I N TRADE AND NOT AS INVESTMENT AND THE PROFIT ARISING FROM SALE OF THE LAND HAS RIGHTLY BEEN TAXED AS BUSINESS INCOME INSTEAD OF L ONG TERM CAPITAL GAIN. THAT ON THE FACTS AND CIRCUMSTANCES OF THE CASE IN L AW THE LD. COMMISSIONER OF INCOME TAX (APPEALS) HAS FAILED TO A PPRECIATE THE FACT THAT HAD THE ASSESSEE TREATED THE LAND AS INVESTMENT IT WAS REQUIRED TO FILE THE RETURN OF WEALTH AS PER T HE PROVISIONS OF WEALTH TAX ACT. THE ASSESSEE HAS NEVER REFLECTED THESE AS INVESTMENT AS ITS WEALTH AND IN FACT FAILED TO FIL E THE WEALTH TAX RETURN. 3. ASSESSING OFFICER IN THIS CASE OBSERVED THAT THREE COMPANIES NAMELY M/S LYNEX ESTATES (P) LTD, M/S MONNET ESTATES (P) LTD AND M/S WORLD CLASS PROPERTIES (P) LTD. MERGED WITH THE ASSES SEE COMPANY IN ACCORDANCE WITH THE SCHEME OF MERGER APPROVED BY THE HON'BLE HIGH COURT, DELHI VIDE ORDER DATED 14.02.2005. THE ASSES SEE HAD DECLARED ITS SOURCES OF INCOME AS FROM AGRICULTURE AND DIVIDEN D. DURING THE YEAR UNDER CONSIDERATION THE ASSESSEE COMPANY HAD SOLD LA ND MEASURING 26 BIGHAS AND 2 BISWA SITUATED AT VILLAGE DERAMANDI FOR A CONSIDERATION OF ` 87 LAKHS ON WHICH LO NG TERM CAPITAL GAIN OF ITA NO. 1172/DEL/2011 3 RS. 66,56,6081 - WAS DECLARED. IN RESPECT TO THE FA CT THAT THE ASSESSEE HAS TAKEN THE SALE OF LAND AND PROFIT EARNED OVER I T UNDER THE HEAD OF CAPITAL GAIN. THE ASSESSEE COMPANY WAS SHOW CAUSED VIDE THIS OFFI CE LETTER DATED 28.10.2009 AS TO WHY THE LAND MAY NOT BE TREATED AS STOCK IN TRADE AND PROFIT EARNED THEREON BE TREATED AS BUSINESS IN COME SINCE THE COMPANY IS ENGAGED IN THE REAL ESTATE BUSINESS AS PE R MOA AND AOA. THE ASSESSEE COMPANY HAS SUBMITTED ITS REPLY TO THIS SHOW CAUSE VIDE LETTER DATED 5.11.2009. THE EXTRACT OF THE RELEVANT PORTION OF THE ASSESSEE SUBMISSION IS AS FOLLOWS:- DURING THE YEAR UNDER CONSIDERATION THE COMPANY HAS S OLD AGRICULTURAL LAND MEASURING 26 BIGHA AND 2 BISWA SITUATED AT VILL AGE DERAMANDI, AS PER REGISTERED SALE DEED DATED 11.03.2006 FOR AN AMO UNT OF RS.87 LACS AND ACCORDINGLY SHOWN CAPITAL GAIN OF RS. 66,56,610 /- AS LONG TERM CAPITAL GAIN AND PAID TAXES ACCORDINGLY. THE AGRICU LTURAL LAND SOLD BELONGS TO LYNEX ESTATE (P) LTD WHICH IS ONE TRANSF EROR COMPANY AND THIS LAND WAS BEING SHOWN AS AN ASSET IN THE BALANC E SHEET OF TRANSFEROR. THE ASSESSEE'S ATTENTION WAS DRAWN TO THE SALE DEED EXECUTED ON 17.02.2005 OF THE LAND WHERE AGAINST THE ENTRY 'SOI L TYPE RESIDENTIAL ' HAS BEEN FILLED. THEREFORE THE LAND SHOULD HAVE BEE N TAKEN AS STOCK IN TRADE. THE ASSESSEE HAS NEVER FILED ANY DOCUMENTARY EVIDENCE THAT BEFORE THE PURCHASE OF SAID LAND IT WAS USED FOR AG RICULTURE. INSTEAD OF THAT THE LAND PAPERS SUBMITTED BY THE ASSESSEE ARE OF THAT WHICH REFLECTS THE ACQUISITION OF THE LAND BY THE LYNEX E STATE (P) LTD. MOREOVER TO PUT MORE WEIGHTAGE ON THE ISSUE, ATTENTI ON OF THE A.R OF ITA NO. 1172/DEL/2011 4 THE ASSESSEE WAS DRAWN TOWARDS THE MAIN OBJECTS OF THE ASSESSEE COMPANY'S AS PER THE MOA WHICH ARE DESCRIBED AS BELOW :- TO ACQUIRE BY THE PURCHASE, LEASE. EXCHANGE AND T O SELL TRANSFER, ASSIGNS DISPOSE OF OR DEAL IN LAND, BUILDINGS AND HEREDITAMENTS OF ANY TENURE OR DESCRIPTION AND ANY ESTATE OR INTERE ST THEREIN. TO MANAGE LAND, BUILDINGS AND OTHER IMMOVABLE PROPE RTY, WHETHER BELONGING TO COMPANY DO NOT AND TO COLLECT RENTS, S ERVICE CHARGES AND INCOME TO SUPPLY TO TENANTS AND OCCUPIERS AND OTHER RELATED FACILITIES. TO BUILD TAKE ON LEASE PURCHASE EXCHANGE OR ACQUI RE IN ANY MANNER OR DEAL IN ANY APARTMENTS FLATS, ROOMS ETC. TO CARRYON OF THE BUSINESS OF BUILDER AND CIVIL C ONTRACTOR, DECORATORS ETC. TO ACCEPT ADVANCE FOR THE CONSTRUCTION OF SUCH FL ATS, DWELLING HOUSES, SHOPS. TO THE ABOVE OBJECTS OF THE COMPANY IT CLARIFIES THA T THE COMPANY IS IN TO THE BUSINESS OF REAL ESTATE BUSINESS AND T HE LAND ACQUIRED IS TO BE CONSIDER AS STOCK IN TRADE. FURTHER THE ASSESSEE S CLAIM THAT THE PROPERTIES WERE HELD AS INVESTMENT FOR THE PURPOSE OF EARNING AGRICULTURAL INCOME APPEARS ALTOGETHER HOLLOW CONSID ERING THE QUANTUM OF INCOME EARNED BY IT DURING THE LAST THREE YEARS AGAINST THE COST OF ACQUISITION. THE FOLLOWING FACTS AND CIRCUMSTANCES SPEAK FOR THEMS ELVES REGARDING THE REAL CHARACTER OF THE TRANSACTIONS AN D THE INTENTION OF THE ASSESSEE COMPANY IN PURCHASING AND SELLING THE PROPERTIES:- ITA NO. 1172/DEL/2011 5 THE ASSESSEE HAS NOT BEEN ENGAGED IN ANY OTHER ACT IVITY WHICH CAN QUALIFY AS BUSINESS IN ANY SYSTEMATIC AND CONTIN UOUS MANNER. INDEED, NO OTHER BUSINESS ACTIVITIES BEEN UNDERTAK EN BY IT IN ALL THESE YEARS. DEALING IN LAND, BUILDINGS HAS BEEN ITS DOMI NANT OBJECT. THUS, AT THE TIME OF ACQUISITION, IT HAD A CLEAR INTENTION TO RESELL IT AT A PROFIT AS AGAINST THE INTENTION TO REALIZE ACCRETION IN V ALUE IN FUTURE. THE LAND WAS NOT PURCHASED WITH THE INTENTION TO HOLD ON TO IT AS AN INVESTMENT AND REALIZE THE ACCRETION IN VALUE. BY SELLING THE LAND THE ASSESSEE HAS ONLY GIVEN SUBSTANTIAL EFFECT TO ITS OBJECT CLAUSE O F DEALING IN LAND AND PROPERTIES. ANOTHER FACT THAT OFFERS A WINDOW INTO THE REAL INTENTIONS OF THE ASSESSEE IS THAT ONLY A PART OF THE LAND HAS BEEN SOLD AND MAJOR CHUNCK THEREOF HAS BEEN RETAINED. HAD THE ASSESSEE S INTENTION BEEN TO REALIZE ACCRETION IN VALUE OF 'INVESTMENT', IT WOULD DEFINITELY HAVE DISPOSED OF THE WHOLE INVESTMENT, GIVEN THE QUANTUM OF THE PREVAILING RATES AT THE TIME OF SALE. IT IS ONLY A PART OF THE LAND THAT HAS BEEN SOLD, MEANING THEREBY THAT THE ASSESSEE PROPOSES TO SELL O R DEVELOP AND SELL THE SAME IN PARTS IN FUTURE, RENDERING THE SAME TO BE AN ORGANIZED BUSINESS ACTIVITY . THE ASSESSEE ITSELF HAS PRACTICALLY BEEN TREATING THE PROPERTIES AS STOCK IN TRADE IS FURTHER EVIDENT FROM THE FACT T HAT VALUE OF 'INVESTMENTS' EXCEEDS RS.15 LAC. HAD THE LAND BEEN T REATED AS AN INVESTMENT BY THE ASSESSEE, IT WOULD HAVE BEEN LIA BLE TO WEALTH TAX. THE FACT THAT THE ASSESSEE HAS NOT BEEN FILING ANY WEALTH TAX RETURNS CLEARLY PROVES THAT THE LAND WAS NOT ACTUALLY TREA TED BY IT AS INVESTMENT. ITA NO. 1172/DEL/2011 6 IN THESE CIRCUMSTANCES I HAVE NO OTHER OPTION BUT T O TREAT THE INCOME EARNED VIA SALE OF THE ABOVE PROPERTY AS BUS INESS INCOME INSTEAD OF INCOME DECLARED BY THE ASSESSEE UNDER T HE HEAD CAPITAL GAINS. HENCE THE INCOME ON SALE OF PROPERTY IS CALC ULATED AS UNDER:- COST OF LAND RS. 1102580/- SALE CONSIDERATION RS. 8700000/- PROFIT RS. 7597420/- HENCE I MAKE AN ADDITION OF RS. 75974201/-. 4. UPON ASSESSEES APPEAL LD. COMMISSIONER OF INCOME TAX (APPEALS) NOTED THE ELABORATE SUBMISSIONS OF THE ASS ESSEE AND HELD AS UNDER:- I HAVE CONSIDERED THE SUBMISSIONS MADE BY THE AUTHOR IZED REPRESENTATIVE OF THE APPELLANT COMPANY. IT HAS BE EN SUBMITTED BY THE APPELLANT THAT THE LAND WHICH WAS SOLD OUT DURING T HE YEAR AND ON WHICH CAPITAL GAINS HAVE BEEN DISCLOSED WAS THE LAN D BELONGING TO M/S LYNX ESTATES P. LTD. ONE OF THE THREE COMPANIES WHIC H AMALGAMATED WITH THE APPELLANT COMPANY W.E.F. 01.04.2004 AS PER THE ORDER OF THE HON'BLE DELHI HIGH COURT. IT IS SEEN THAT M/S LYNX ESTATES P LTD. HAD PURCHASED THIS LAND AS FAR BACK AS IN THE NINETIES AND HAS BEEN DECLARING THIS LAND AS PART OF ITS FIXED ASSETS IN ITS RETURN OF INCOME BEING FILED FROM THAT YEAR ONWARDS. THE AGRICULTURA L INCOME DECLARED TO HAVE BEEN EARNED FROM THIS LAND HAS ALSO BEEN ACCEP TED BY THE DEPARTMENT EVERY YEAR. SIMILARLY IN THE CASE OF THE A PPELLANT COMPANY, IT HAD PURCHASED AGRICULTURAL LAND AND HAD SHOWN THIS LAND AS PART OF ITS FIXED ASSETS YEAR AFTER YEAR, WHICH WAS ALSO ACCEPTED BY THE THEN ASSESSING OFFICER. THE APPELLANT COMPANY HA D ALSO EARNED ITA NO. 1172/DEL/2011 7 AGRICULTURAL INCOME FROM THIS LAND WHICH WAS DULY A CCEPTED BY THE ASSESSING OFFICER. MERELY BECAUSE THE NAME OF THE AP PELLANT COMPANY IS M/S NEON PROPERTIES P. LTD., IT DOES NOT IMPLY THAT EVERY LAND PURCHASED BY IT WAS DONE WITH THE INTENTION OF THE BUSINESS OF SALE AND PURCHASE OF PROPERTIES. IN FACT, CLAUSE 58 OF THE A RTICLES OF ASSOCIATION OF THE COMPANY LAYS DOWN THE ACTIVITY OF FARMING, AGR ICULTURE AND HORTICULTURE AS ONE OF THE OBJECTS OF THE COMPANY. NE ITHER THE APPELLANT COMPANY NOR M/S LYNX ESTATES P. LTD. WHICH AMALGAMATED WITH THE APPELLANT AND WHOSE LAND WAS SOLD DURING T HE YEAR, ENGAGED IN FREQUENT BUYING AND SELLING OF LAND WHICH WOULD BE EVIDENT FROM DETAILS OF THEIR EARLIER YEARS INCOME AND INVESTME NTS PROVIDED BY THE APPELLANT DURING THE COURSE OF PROCEEDINGS. THUS, T HE CONCLUSION DRAWN BY THE ASSESSING OFFICER THAT THE PROFIT ON SALE OF AGRICULTURAL LAND CONSTITUTED BUSINESS INCOME AND NOT CAPITAL GAINS OF THE APPELLANT IS UNWARRANTED. THIS ALSO GETS SUPPORT FROM THE FOLLOW ING FACTS:- A. AS PER THE COPY OF THE KHASRA GIRDAWARI FURNIS HED BY THE APPELLANT, THE LAND WAS BEING USED FOR AGRICULTURAL PURPOSES, WITH THE CROP 'BAJRA' GROWN ON THE SAME. B. THE APPELLANT HAS DRAWN ATTENTION TO RULE 21A OF THE DELHI LAND REFORMS RULES, 1954 WHICH STATES THAT AGRICULTU RAL LAND WITHIN THE TERRITORIAL LIMIT OF DELHI CANNOT BE USED FOR NON- AGRICULTURAL PURPOSES. SINCE THE LAND IN QUESTION W AS LOCATED WITHIN THE TERRITORIAL LIMITS OF DELHI AND WAS AGRI CULTURAL LAND, IT COULD NOT HAVE BEEN USED FOR NON-AGRICULTURAL PURPO SES. C. AT PAGE 25 OF THE SALE DEED EVIDENCING THE SAL E OF LAND DURING THE YEAR, IT HAS BEEN ITA NO. 1172/DEL/2011 8 STATED THAT THE LAND IN QUESTION IS AGRICULTURAL LA ND. D. EVEN IF LAND IS NON-AGRICULTURAL LAND, THERE IS NO BAR IN HOLDING IT AS LONG TERM INVESTMENT INSTEAD OF STOCK-IN-TRADE . WHAT IS TO BE SEEN IS THE INTENTION OF THE PERSON HOLDING THE LAND. IN THE CASE OF THE APPELLANT AS WELL AS OF M/S LYNX ESTATES P. LTD., AS ALREADY DISCUSSED IN THE EARLIER PARAGRAPHS, AGRICULTURAL LAND WAS PURCH ASED ONLY ONCE PRIOR TO ASSESSMENT YEAR 2005-06. THEREAFTER, THERE WER E NO FREQUENT ACTIVITIES OF SALE AND PURCHASE OF LAND AND RENT OF LAND PURCHASED WAS USED FOR AGRICULTURAL PURPOSES AND HAS BEEN SOLD DU RING THE YEAR UNDER APPEAL I.E. AFTER ABOUT A DECADE. E. A CHART OF AGRICULTURAL INCOME EARNED BY THE APP ELLANT COMPANY AND THE THREE COMPANIES WHICH MERGED WITH IT W.E.F. 01.04.2004 SHOWS THAT TOTAL AGRICULTURAL INCOME OF RS.24.49 LACS WAS EARNED FROM THE LAND HELD BY THESE COMPANIES UPTO 31. 03.2005 WHICH IS QUITE SUBSTANTIAL. BESIDES THIS, THE VALUE OF TH E LAND HAS ALSO APPRECIATED OVER THE YEARS. THUS, THERE IS NO REASO N TO DISBELIEVE THAT THE APPELLANT COMPANY AND THE OTHER THREE COMPANIES AMALGAMATING WITH IT DID PURCHASE THE LAND FOR THE PURPOSE OF LO NG TERM INVESTMENT AND NOT FOR THE BUSINESS OF BUYING AND SELLING LAND AND HAVE BENEFITTED SUBSTANTIALLY FROM SUCH INVESTMENT. F. IT HAS BEEN EXPLAINED THAT NO WEALTH TAX HAS B EEN PAID ON THE SAID LAND BECAUSE IT IS AGRICULTURAL IN NATURE AND NOT URBAN LAND AND HENCE NO WEALTH TAX WAS PAYABLE THEREON. FROM THE TOTALITY OF THE FACTS OF THE CASE AS DISCUSS ED ABOVE, IT IS OBVIOUS THAT THE LAND IN QUESTION WAS NOT STOCK-IN- TRADE OF THE APPELLANT COMPANY BUT WAS PART OF ITS LONG TERM INVE STMENTS AND THE PROFITS ARISING FROM SALE THEREOF WAS RIGHTLY TAKEN BY THE APPELLANT AS ITA NO. 1172/DEL/2011 9 LONG TERM CAPITAL GAIN. THE ASSESSING OFFICER IS DIR ECTED TO TREAT THIS SURPLUS AS LONG TERM CAPITAL GAIN AND NOT BUSINESS I NCOME AS HELD BY HIM IN THE ASSESSMENT ORDER. 5. AGAINST THE ABOVE ORDER REVENUE IS IN APPEAL BEF ORE US. 6. WE HEAVE HEARD THE RIVAL CONTENTIONS AND PERUSE D THE RELEVANT RECORDS. 6.1 LD. DEPARTMENTAL REPRESENTATIVE SUBMITTED THAT TH E MAIN OBJECT OF THE COMPANY INCLUDES DEALING IN LAND. HENCE, THE ACTIVITY OF THE ASSESSEE I.E. PURCHASE AND SALE OF LAND CAN ONLY BE CONSIDERED AS BUSINESS ACTIVITY. HE CLAIMED THAT LAND WAS SITUA TED IN HAUZ KHAS, NEW DELHI WERE FARM HOUSES ARE THERE. HE SAID TH AT THE SAID LAND CANNOT BE CONSIDERED AS AGRICULTURAL LAND. HE SUBMI TTED THAT THE INCOME FROM AGRICULTURE SHOWN WAS VERY LOW. HE STR ONGLY RELIED UPON THE ORDER OF THE ASSESSING OFFICER . 6.2 LD. COUNSEL OF THE ASSESSEE ON THE OTHER HAND S UPPORTED THE ORDERS OF THE LD. COMMISSIONER OF INCOME TAX (APPEAL S). HE INTER-ALIA SUBMITTED THAT NO CONSTRUCTION ACTIVITY WAS POSSIBL E IN THESE LANDS, AS PER RULES. HENCE, WEALTH TAX IS NOT LEVIABLE ON TH IS. HE FURTHER SUBMITTED THAT AGRICULTURE ACTIVITY WAS VERY MUCH THE OBJECT OF THE COMPANY AS ANCILLARY AND INCIDENTAL OBJECT. 6.3 WE HAVE CAREFULLY CONSIDERED THE SUBMISSION. WE FIND THAT ASSESSEE HAS RETURNED AGRICULTURE INCOME ON THE SAI D LAND YEAR AFTER YEAR AND THE SAME HAS BEEN ACCEPTED BY THE DEPARTMEN T. THE AGRICULTURAL LAND HAS BEEN SHOWN AS FIXED ASSETS Y EAR AFTER YEAR, WHICH HAS BEEN ACCEPTED BY THE ASSESSING OFFICER. CLAUSE 58 OF ITA NO. 1172/DEL/2011 10 MEMORANDUM OF ASSOCIATION OF THE COMPANY LAYS DOWN THE ACTIVITY OF FARMING, AGRICULTURE AND HORTICULTURE AS ONE OF THE ANCILLARY OBJECTS OF THE COMPANY. 6.4 WE FURTHER NOTE THAT ASSESSEE IS NOT ENGAGED I N FREQUENT BUYING AND SELLING OF THE LAND. WE FURTHER NOTE THAT AS PER THE COPY OF KHASRA GIRDAVRI FURNISHED BY THE ASSESSEE, THE LAND WAS BEING USED FOR THE AGRICULTURE PURPOSES, WITH THE CROP BAZRA GR OWN ON THE SAME. WE FURTHER NOTE THAT AS PER RULE 21 OF THE DELHI LA ND REFORMS RULES, 1954 THAT THE AGRICULTURAL LAND WITHIN THE TERRITOR IAL LIMIT OF DELHI CAN NOT BE USED FOR NON-AGRICULTURAL PURPOSES. IN THE S ALE DEED IT HAS BEEN STATED THAT LAND IN QUESTION IS AGRICULTURAL LAND. 6.5 THUS, WE FIND THAT APART FROM THE MAIN OBJECT O F DEALING IN LANDS, THE ASSESSEE ANCILLARY OBJECTS ALSO INCLUDE AGRICULT URAL ACTIVITY. HENCE, ASSESSEES OBJECTS IN THE MEMORANDUM CAN NOT BE SA ID TO BE DETERMINATIVE OF NATURE OF TRANSACTION AS BUSINESS. SINCE NO CONSTRUCTION ACTIVITY WAS PERMISSIBLE ON THESE LANDS , THEY COULD NOT BE INCLUDED FOR WEALTH TAX PURPOSES. MOREOVER, THERE I S NO BAR IN HOLDING LAND AS LONG TERM INVESTMENT. ASSESSEES CONDUCT D OES NOT REFLECT A SYSTEMATIC FREQUENT PURCHASE AND SALE OF LAND TO QUA LIFY THE ASSESSEES ACTIVITY AS BUSINESS OF DEALING IN LANDS. ITA NO. 1172/DEL/2011 11 6.6 IN THE BACKGROUND OF THE AFORESAID DISCUSSION, WE DO NOT FIND ANY INFIRMITY OR ILLEGALITY IN THE ORDER OF THE LD. COMMI SSIONER OF INCOME TAX (APPEALS). HENCE, WE UPHOLD THE SAME. 7. IN THE RESULT, THE APPEAL FILED BY THE REVENUE STANDS DISMISSED. ORDER PRONOUNCED IN THE OPEN COURT ON 13/05/2011. SD/- SD/- [ [[ [RAJPAL YADAV RAJPAL YADAV RAJPAL YADAV RAJPAL YADAV] ]] ] [SHAMIM YAHYA] [SHAMIM YAHYA] [SHAMIM YAHYA] [SHAMIM YAHYA] JUDICIAL MEMBER JUDICIAL MEMBER JUDICIAL MEMBER JUDICIAL MEMBER ACCOUNTANT MEMBER ACCOUNTANT MEMBER ACCOUNTANT MEMBER ACCOUNTANT MEMBER DATE 13/05/2011 SRB COPY FORWARDED TO: COPY FORWARDED TO: COPY FORWARDED TO: COPY FORWARDED TO: - -- - 1. APPELLANT 2. RESPONDENT 3. CIT 4. CIT (A) 5. DR, ITAT TRUE COPY BY ORDER, DEPUTY REGISTRAR, ITAT, DELHI BENCHES