Shri Jayanthilal Ghisulal Surana, CHENNAI V. ITO, CHENNAI

ITA 152/CHNY/2013

• Counselvise Citation: [2014] 140 COUNSELVISE.COM (IT) 73657 (ITAT-CHENNAI)
• Duration Of Justice: 1 year(s) 15 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 13-02-2014
• Appeal Filed By: Assessee
• Order Result: Partly Allowed
• Bench Allotted: D
• Next Hearing Date: 11-02-2014
• Assessment Year: 2007-2008
• Appeal Filed On: 29-01-2013
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Department Lawyers: HARI RAO JT
• Assessee Lawyers: D ANAND
• Keywords: Capital asset; Cost of acquisition
• Section: 143(3); 54

Judgement Text

, , IN THE INCOME TAX APPELLATE TRIBUNAL D BENCH : CHENNAI . , . . ! , ' # [BEFORE SHRI A. MOHAN ALANKAMONY, ACCOUNTANT MEMB ER AND SHRI S. S. GODARA, JUDICIAL MEMBER] ./ I.T.A.NO.152/MDS/2013 / ASSESSMENT YEAR : 2007-08 SHRI JAYANTHILAL GHISULAL SURANA NO.59, ERULAPPAN STREET CHENNAI- 600 003 VS. THE INCOME TAX OFFICER BUSINESS WARD XII(4) CHENNAI [PAN AAJPS 7833 G ] ( $% / APPELLANT) ( &'$% /RESPONDENT) ./ I.T.A.NO.378/MDS/2013 / ASSESSMENT YEAR : 2007-08 THE ASSTT. COMMISSIONER OF INCOME-TAX BUSINESS CIRCLE X CHENNAI VS. SHRI JAYANTHILAL GHISULAL SURANA NO.59, ERULAPPAN STREET CHENNAI- 600 003 ( $% / APPELLANT) ( &'$% /RESPONDENT) ASSESSEE BY : SHRI D. ANAND, ADVOCATE DEPARTMENT BY : SHRI HARI RAO, JT. CIT / DATE OF HEARING : 11-02-2014 / DATE OF PRONOUNCEMENT : 13-02-2014 ( / O R D E R PER S.S.GODARA, JUDICIAL MEMBER THESE CROSS APPEALS FILED BY ASSESSEE AND THE R EVENUE FOR ASSESSMENT YEAR 2007-08, ARE DIRECTED AGAINST COMM ON ORDER OF THE I.T.A.NO.152 &378/13 :- 2 -: COMMISSIONER OF INCOME-TAX (APPEALS)-IV, CHENNAI, D ATED 30.10.2012, PASSED IN APPEAL NO.340/2009-10, IN PROCEEDINGS UND ER SECTION 143(3) OF THE INCOME-TAX ACT, 1961 (IN SHORT THE ACT). 2. A COMBINED PERUSAL OF THE GROUNDS RAISED IN BOTH AP PEALS MAKES IT CLEAR THAT THE ASSESSEES GRIEVANCE IS TW O FOLDED I.E HE CHALLENGES ACTION OF THE CIT(A) IN CONFIRMING DISAL LOWANCE/ADDITION OF INTEREST AND OTHER PAYMENTS OF ` 29,23,302/- ALLEGEDLY INCURRED FOR THE PURPOSE OF INVESTMENT AND EXPENSES AMOUNTING TO ` 27,50,000/- CLAIMED ON SALE OF PROPERTY AT CHEMBARAMBAKKAM. IN THE SAME TONE, THE REVENUE IS AGGRIEVED BY THE ACTION OF THE CIT(A ) IN DELETING ADDITION OF CAPITAL GAINS QUA ASSESSEES LAND SOLD AT VEDAL AMOUNTING TO ` 16,03,375/- BY HOLDING THEM AS AGRICULTURAL IN NA TURE. 3. COMMON FACTS RELEVANT TO BOTH APPEALS ARE THAT THE ASSESSEE, AN INDIVIDUAL, IS IN THE BUSINESS OF F INANCING AND REAL ESTATE ETC. ON 31.10.2007, HE HAD FILED RETURN DISCLOSING TOTAL INCOME OF ` 3,76,762/- WHICH WAS SUMMARILY PROCESSED. THEREA FTER, THE ASSESSING OFFICER FRAMED REGULAR ASSESSMENT VIDE ORDER DATED 26.12.2009 MAKING THE AFORESAID DISALLOWANCES/ADDIT IONS. I.T.A.NO.152 &378/13 :- 3 -: 4. IN THE LOWER APPELLATE PROCEEDINGS, THE CIT(A) HAS DELETED THE ADDITION PERTAINING TO CAPITAL GAINS ALLEGED TO HAVE ARISEN FROM SALE OF LAND AT VEDAL AMOUNTING TO ` 16,03,375/-. THIS LEAVES BOTH PARTIES AGGRIEVED TO THE EXTENT STATED ABOVE. FIRST WE COME TO ASSESSEES APPEAL I.T.A.NO. 152/ MDS/2013. 5. RELEVANT FACTS QUA THE FIRST GROUND ARE THAT IN THE COURSE OF SCRUTINY, THE ASSESSING OFFICER NOTICED THE ASSE SSEE TO HAVE DEBITED IN THE PROFIT & LOSS ACCOUNT A SUM OF ` 29,23,302/- INCLUDING INTEREST OF ` 23,31,114/-. THERE IS NO DISPUTE THAT THE ASSESSE E HAD BEEN ENGAGED IN NO BUSINESS AND ONLY INCOME DECLARED WAS A SUM OF ` 1 LAKH UNDER THE HEAD OTHER SOURCES. THEREAFTER, H E HAD COMPUTED LOSSES OF THE AFORESAID AMOUNT AND SOUGHT TO ADJUST THEM AGAINST SHORT TERM CAPITAL GAINS. IN SUPPORT, THE ASSESSE E PLEADED TO HAVE USED THE LOANS FOR PURCHASING THE PROPERTY SOLD IN THE RELEVANT PREVIOUS YEAR GIVING RISE TO SHORT TERM CAPITAL GAI NS. IN HIS VIEW, THE SAME WOULD ENTITLE HIM TO CLAIM EXPENSES U/S 48(II ) IN THE NATURE OF COST OF ACQUISITION. WE FIND FROM THE ASSESSMENT O RDER THAT THE ASSESSING OFFICER WAS NOT CONVINCED WITH THE ASSES SEES AFORESAID PLEAS. DENYING THE ASSESSEES CLAIM, HE HELD THAT THERE WAS NO CO- RELATION PROVED BETWEEN THE ASSESSEES BORROWED MO NEY WITH THE I.T.A.NO.152 &378/13 :- 4 -: PROPERTY ALLEGED TO HAVE PURCHASED BY HIM AND ALSO THAT THE AMOUNT IN QUESTION HAD NOT BEEN CAPITALIZED WHICH WAS A CONDI TION PRESCRIBED U/S 48(II) OF THE ACT. HE FURTHER NOTICED THAT T HE ASSESSEE HAD PAID INTEREST TO CREDITORS/FAMILY MEMBERS, BUT DID NOT CHARGE THE SAME FROM THEM QUA HIS DEBTS. IN THIS MANNER, THE ASSES SING OFFICER OBSERVED THAT THE ADJUSTMENT OF LOSS SOUGHT TO BE MADE BY THE ASSESSEE WAS NOT ALLOWABLE. AS A RESULT, THE IMPUG NED ADDITION WAS MADE IN ASSESSEES INCOME. 6. IN LOWER APPELLATE PROCEEDINGS, THE CIT(A) HAS CONF IRMED THE FINDINGS OF THE ASSESSING OFFICER AS FOLLOWS: AS COULD BE SEEN FROM THE RECORDS THE ASSES SEE HAS NOT CARRIED OUT ANY BUSINESS ACTIVITY WHOSE INCOME IS ASSESSABL E UNDER THE HEAD 'INCOME FROM BUSINESS OR PROFESSION', DURING THE FI NANCIAL YEAR 2006- 07. THE ONLY ACTIVITY CARRIED ON BY THE ASSESSEE DU RING THE YEAR WAS PURCHASE AND SALE OF VARIOUS PROPERTIES. THE SURPLU S GENERATED FROM THE SALE OF PROPERTIES WAS OFFERED TO TAX UNDER THE HEAD CAPITAL GAINS'. IN FACT, IT ALSO AN ADMITTED FACT THAT THE ASSESSEE UTILIZED THE BORROWED FUNDS FOR THE PURPOSE OF INVE STING IN VARIOUS LANDED PROPERTIES. FURTHER ALL THE PROPERTI ES ARE SHOWN AS INVESTMENTS (AND NOT AS 'STOCK-IN-TRAD E) IN THE BALANCE SHEET. WHEN THE PROPERTIES PURCHASED ARE TREATED A S INVESTMENTS AND THE INCOME GENERATED ON SALE OF SUC H PROPERTIES ARE OFFERED TO TAX AS 'CAPITAL GAINS', O NLY STATUTORY DEDUCTIONS AS STIPULATED U/S.45 TO 55F OF THE ACT A RE ALLOWABLE AS EXPENSES/DEDUCTIONS. THESE INCLUDE COS T OF ACQUISITION, COST OF IMPROVEMENTS TOGETHER WITH IND EXATION, COST OF TRANSFER AND OTHER EXEMPTIONS FROM SEC. 54 TO 54H OF THE ACT. THESE PROVISIONS DO NOT PROVIDE FOR ALLOWI NG INTEREST ON THE BORROWED FUNDS, AS EXPENDITURE, WHILE COMPUT ING THE CAPITAL GAINS. INSTEAD, IN PLACE OF INTEREST ELEMEN T AND/OR INFLATION, A DIFFERENT TYPE OF DEDUCTION IN THE FOR M OF 'INDEXATION' IS PROVIDED FOR. I.T.A.NO.152 &378/13 :- 5 -: IN THE INSTANT CASE, THE BORROWED FUNDS ARE UTILIZE D FOR ACQUIRING THE PROPERTIES, WHICH ARE SHOWN AS INVEST MENTS AND THE SURPLUS ON SALE OF SUCH ASSETS IS BEING OFF ERED TO TAX UNDER THE HEAD 'CAPITAL GAINS'. HENCE THE INTEREST EXPENSES ARE NOT ALLOWABLE DEDUCTIONS AS THE PROVISIONS OF T HE INCOME TAX ACT DO NOT PROVIDE FOR SUCH ALLOWANCE. SIMILARL Y, ALL THE OTHER EXPENSES (INCLUDED IN RS.29,23,302/-) CLAIMED BY THE ASSESSEE ARE ALSO NOT ALLOWABLE AGAINST THE INC OME UNDER THE HEAD 'CAPITAL GAINS'. IN VIEW OF THE ABOVE, THE ASSESSING OFFICER HAS RIG HTLY DISALLOWED ALL THE EXPENSES OF RS.29,23,302/ - CLAI MED BY THE ASSESSEE AGAINST THE INCOME OFFERED TO TAX UNDE R THE HEAD 'CAPITAL GAINS'. THE DISALLOWANCE MADE BY THE ASSESSING OFFICER IS CONFIRMED. IN THIS BACKDROP, WE ARE ADJUDICATING THE INSTANT G ROUND. 7. WE HAVE HEARD BOTH PARTIES AND GONE THROUGH THE CAS E FILE. WE MAKE IT CLEAR THAT IN THE COURSE OF ARGUMENTS, T HE ASSESSEE HAS NOT FILED ANY PAPER BOOK ETC. SO AS TO PROVE THE NE XUS OF THE ALLEGED BORROWED FUNDS WITH THE PROPERTIES PURCHASED. HE H AS ALSO NOT STATED ANY CASE LAW SO AS TO SUBMIT AS TO HOW THE INTEREST AMOUNT IN QUESTION FORMS PART OF THE COST OF ACQUISITION OF A SSETS IN QUESTION. ON BEING GRANTED OPPORTUNITY, THE ASSESSEE HAS MERELY REITERATED THE GROUNDS. IN OUR VIEW, MERE REITERATION OF GROUNDS IN ABSENCE OF QUOTING COGENT EVIDENCE AND RELEVANT CASE LAW DOES NOT FORM A BASIS SO AS TO INTERFERE WITH THE FINDINGS OF THE LOWER A PPELLATE PROCEEDINGS. THEREFORE, THE ACTION OF THE CIT(A) IN CONFIRMING T HE IMPUGNED ADDITION OF ` 29,23,302/- STANDS UPHELD. I.T.A.NO.152 &378/13 :- 6 -: 8. THE NEXT GROUND TAKEN IN ASSESSEES APPEAL IS ABOU T DISALLOWANCE OF EXPENDITURE OF ` 27,50,000/-(SUPRA) BY THE ASSESSING OFFICER AS WELL AS CIT(A). 9. BRIEF FACTS QUA THIS GROUND ARE THAT IN ASSESSMENT YEAR 2006-07, THE ASSESSEE HAD PURCHASED AN IMMOVABLE PR OPERTY AT CHEMBARAMBAKKAM FOR ` 1,75,26,648/-. IN THE RELEVANT PREVIOUS YEAR HE SOLD IT FOR ` 11,25,00,000/-. THIS FETCHED HIM PROFITS OF ALMOS T 650% IN THE NATURE OF SHORT TERM CAPITAL GAINS. AT THE SAME TIME, THE ASSESSEE CLAIMED EXPENSES OF ` 50 LAKHS TO HAVE BEEN INCURRED FOR COST OF IMPROVEMENT AND EXECUTION OF SALE DEED. TH ERE IS NO QUARREL BETWEEN THE PARTIES THAT ALL PAYMENTS WERE MADE BY ACCOUNT PAYEE CHEQUES AND THE IDENTITY OF THE PAYEES IS ALSO NOT IN DISPUTE. HOWEVER, THE AUTHORITIES BELOW HAVE ONLY ALLOWED TH E CLAIM TO THE EXTENT OF ` 22.50 LAKHS PAID AS BROKERAGE COMMISSION. REST OF THE AMOUNTS OF ` 12,50,000/- PAID TO SHRISUNDARRAJAN, ` 11,00,000/- TO SHRI L. DHARAMCHAND, ` 1,50,000/- EACH PAID TO SHRI GAJENDRA UBADHAYAYA AND SHRI PADMANABHAN ALONGWITH A SUM OF ` 1,00,000/- PAID TO SHRI SUBRAMANIAN STAND DISALLOWED. QUA ALL THESE PAYEES , THE LOWER AUTHORITIES HAVE OBSERVED THAT THE ASSESSEE FAILED TO PROVE THE SERVICES RENDERED AS WELL AS GENUINENESS OF THE CLA IMS. I.T.A.NO.152 &378/13 :- 7 -: 10. FIRST WE COME TO SHRI SUNDARRAJAN WHO IS STATED TO HAVE BEEN PAID A SUM OF ` 12,50,000/-. UNDISPUTEDLY, THE SAID PAYEE WAS CALLED UPON BY THE ASSESSING OFFICER. IT WAS FOUND THAT HE HAD INDEED RECEIVED THE AFORESAID SUM AS BROKERAGE AND IT WAS YET TO BE ASSESSED IN HIS HUF ACCOUNT. ON BEING PUT TO CROSS EXAMINAT ION, THE AFORESAID PAYEE STATED THAT HE WAS A CIVIL CONTRACTOR AND GOT A SUM OF ` 4,00,000/- FOR FILLING UP THE LAND PURCHASED/SOLD B Y THE ASSESSEE. QUA THE BALANCE AMOUNT OF ` 8,50,000/-, HE DEPOSED THAT ON ASSESSEES ASKING, THE SAID AMOUNT WAS PAID TO ONE SHRI PARASCHAND. FOR THIS REASON ONLY THE ASSESSING OFFICER AS WELL AS CIT(A) HAVE DISALLOWED THE CLAIM. IN THESE CIRCUMSTANCES, IN O UR VIEW, THERE IS HARDLY ANY DOUBT THAT SO FAR AS ` 4,00,000/- CLAIM IS CONCERNED, THE ASSESSEE HAS PAID A SUM OF ` 4,00,000/- TO THE CIVIL CONTRACTOR FOR EARTH FILLING JOB TO MAKE THE PROPERTY FIT FOR EA RNING HUGE PROFITS. THAT BEING THE CASE, IF FORMS COST OF IMPROVEMENT O F THE ASSET AND THE SAME IS ALLOWABLE. QUA THE OTHER AMOUNT OF ` 8,50,000/-, ADMITTED FACTUAL POSITION IS THAT MERELY ON ORAL SUBMISSION OF SHRI SUNDARRAJAN, THE AUTHORITIES BELOW HAVE DISALLOWED THE SAME WITH OUT EVEN CARING TO SUMMON SHRI PARASCHAND. THERE IS ALSO NO FINDING T HAT THE SUM IN QUESTION OF ` 8,50,000/- CAME BACK TO THE ASSESSEE. IN THIS MA NNER, NEITHER THE ASSESSING OFFICER VERIFIED PAYMENT TO T HE SAID THIRD PARTY I.T.A.NO.152 &378/13 :- 8 -: NOR ASKED THE ASSESSEE TO REBUT THE SAME. IN THES E CIRCUMSTANCES, WE HOLD THAT THE BALANCE SUM OF ` 8,50,00,000/- IS ALSO ALLOWABLE AS EXPENDITURE INCURRED FOR IMPROVEMENT OF LAND SOLD. 11. NOW, WE COME TO THE OTHER CLAIM OF ` 11,00,000/- PAID TO SHRI L. DHARAMCHAND. UNDISPUTEDLY, THIS PAYEE WAS ALSO SUMMONED IN THE COURSE OF SCRUTINY. HE APPEARED AND SUPPORTE D THE ASSESSEES VERSION. THE MODE OF PAYMENT ETC IS STATED AS ACCO UNT PAYEE CHEQUE. HOWEVER, THE ASSESSING OFFICER AS WELL AS CIT(A) AR E UNANIMOUS IN HOLDING THAT SINCE THE LAND HAD BEEN PURCHASED FROM THE SAID PAYEE AND THE EXPENDITURE HAD BEEN INCURRED FOR CLEARING THE SITE, THE ASSESSEE WAS UNDER NO OBLIGATION TO DO THE SAME. F URTHER, IT HAS BEEN HELD THAT THE PAYEE WAS A LOAN CREDITOR IN ASSESS MENT YEAR 2006-07 FOR A SUM OF ` 10,00,000/- AND THE AMOUNT WAS CLAIMED DURING THE YEAR. IN OUR VIEW, THE AUTHORITIES BELOW HAVE WRON GLY DRAWN THESE INFERENCES. QUA FACTUM OF PAYMENT OR MODE THEREOF, THE REVENUE IS FAIR ENOUGH NOT TO RAISE ANY QUERY. ITS ONLY PLEA IS THAT THE CLAIM DOES NOT SATISFY THE TEST OF GENUINENESS. THERE IS NEIT HER ANY FINDING NOR ANY ARGUMENT RAISED THAT THE AFORESAID EXPENDITURE HAD NOT BEEN INCURRED BY THE ASSESSEE FOR THE PURPOSE OF CLEARI NG THE SITE AND THAT TOO, AFTER PURCHASING THE LAND IN ASSESSMENT YEAR 2 006-07. THAT BEING THE CASE, WE HARDLY SEE ANY JUSTIFICATION ON PART O F THE ASSESSING I.T.A.NO.152 &378/13 :- 9 -: OFFICER OR CIT(A) TO DENY THE EXPENDITURE AS COST O F IMPROVEMENT TO THE ASSESSEE MERELY BY PRESUMING THAT THE CLAIM WA S NOT GENUINE. IN THESE CIRCUMSTANCES, THE RELEVANT ARGUMENT THAT THI S PAYMENT WAS ALSO FOR IMPROVEMENT OF THE ASSET SOLD IS ACCEPTED. 12. THIS LEAVES US WITH THE THIRD PLEA OF THE ASSESSEE REGARDING SUMS OF ` 1,50,000/- EACH PAID TO SHRI GAJENDRA UBADHYAYA AN D SHRI PADMANABHAN ALONGWITH ` 1,00,000/- PAID TO SHRI SUBRAMANIAN. QUA THESE PAYMENTS, ADMITTEDLY, THE ASSESSEE HAD FAILE D TO SUBSTANTIATE THE NATURE OF SERVICES RENDERED. IN THE COURSE OF SCRUTINY AND LOWER APPELLATE PROCEEDINGS, HE SUBMITTED THAT THESE PAY MENTS WERE MADE FOR SERVICES RENDERED BY THE PAYEES WITHOUT ANY RE ASON. ON THIS, THE ASSESSING OFFICER AS WELL AS CIT(A) HAVE DENIED THE CLAIM. IN OUR VIEW AS WELL, WITHOUT EVEN CLARIFYING ABOUT THE EXACT NA TURE OF THE SERVICES RENDERED AND MERELY BY SUBMITTING THAT THE SERVICES WERE RENDERED WITHOUT ANY REASON HARDLY FORMS A REASONABLE GR OUND TO ALLOW THE EXPENDITURE. THUS, WE REJECT THE RELEVANT CLAIMS O F THE ASSESSEE QUA THE AMOUNTS AFORESAID. THE FINDINGS OF THE CIT(A) QUA THESE THREE PAYEES STAND UPHELD. I.T.A.NO.152/MDS/2013 FILED BY THE ASSESSEE IS P ARTLY ALLOWED. I.T.A.NO.152 &378/13 :- 10 -: 13. NOW, WE COME TO REVENUES APPEAL I.T.A.NO.378/MDS/2 013. 14. BRIEF FACTS QUA THE GRIEVANCE OF THE REVENUE(SUPRA) ARE THAT IN THE COURSE OF SCRUTINY, THE ASSESSING OFFICER C AME ACROSS PROFITS OF ` 16,03,375/- DECLARED BY THE ASSESSEE FROM LAND SO LD ON 29.5.2006, BUT CLAIMED FROM SALE OF AGRICULTURAL LAND. THE ASSESSEE HAD PURCHASED THIS LAND ON 26.2.2005 AT VEDAL VILLAGE I N KANCHEEPURAM DISTRICT. ON 29.5.2006 HE HAD SOLD THE PROPERTY FE TCHING THE IMPUGNED PROFITS. AS PER THE ASSESSING OFFICER, THIS PROFIT HAD TO BE TAXED AS CAPITAL GAINS AS THE ASSESSEE HAD PURCHASED THE LA ND JOINTLY WITH OTHER PURCHASERS, SOLD THE SAME TO M/S NEW MARUTHI BUILDE RS CARRYING ON BUSINESS AS REAL ESTATE AGENT, FLAT PROMOTERS, BUIL DERS AND ENGINEERING CONTRACTORS DURING BOOM PERIOD. THE ASSESSEE HA D CLAIMED THE LAND TO BE AGRICULTURAL WHOSE PROFITS ARE EXEMPT FROM BEING TAXED. HE EMPHASIZED THAT THERE WAS NO INTENTION TO DO ANY BU SINESS AND THE LAND HAD NOT BEEN CLAIMED AS STOCK-IN-TRADE. PER ASSESSING OFFICER, ASSESSEES CONDUCT OF SALE TO BUILDERS DEMONSTRATED HIS INTENTION NOT TO INDULGE IN AGRICULTURAL ACTIVITIES. HE ALSO POI NTED OUT FAILURE ON ASSESSEES PART TO PROVE CARRYING OUT OF ANY AGRICU LTURAL ACTIVITY. THEREFORE, THE ASSESSING OFFICER REJECTED THE RELE VANT CONTENTIONS OF THE ASSESSEE AND BROUGHT TO TAX THE AFORESAID PROF ITS. I.T.A.NO.152 &378/13 :- 11 -: 15. IN LOWER APPELLATE PROCEEDINGS, THE CIT(A) OBSERVES THAT THE LAND SOLD BY THE ASSESSEE IS NOT WITHIN 8 KMS. FRO M THE OUTER LIMITS OF ANY MUNICIPALITY OR CANTONMENT BOARD SO AS TO CHANG E ITS NATURE FROM AGRICULTURAL TO A CAPITAL ASSET WITHIN THE MEA NING OF SECTION 2(14)(III) OF THE ACT. MERELY ON THIS REASON, HE HOLDS THAT T HE LAND WAS AGRICULTURAL IN NATURE AND WHOSE SALE DOES NOT GIVE RISE TO ANY CAPITAL GAINS. QUA SHORT HOLDING PERIOD, NATURE OF THE OWN ER, KEEPING THE LAND VACANT AND BUYERS NATURE, THE CIT(A) OPINES THAT THIS IS AN IMMATERIAL FACTOR AND ONLY THING TO BE SEEN IS THE NATURE OF THE LAND SOLD. IN THIS MANNER, THE ADDITION IN QUESTION ST ANDS DELETED. 16. BEFORE US, THE REVENUE VEHEMENTLY REITERATES THE GR OUNDS TO ARGUE THAT THE ASSESSING OFFICER HAD RIGHTLY TAXED THE PROFITS FROM THE LAND SOLD AS CAPITAL GAINS IN VIEW OF THE FINDINGS CONTAINED IN THE ASSESSMENT ORDER. HOWEVER, HE HAS FAILED TO CONTRO VERT THE FINDING OF FACT ARRIVED AT BY THE CIT(A) THAT THE LAND IS NOT A CAPITAL ASSET OR NOT SITUATED WITHIN 8 KMS. OF ANY MUNICIPALITY OR CANTO NMENT BOARD. THERE IS NO REVENUE RECORD PRODUCED TO CHALLENGE THE FIN DINGS QUA NATURE OF LAND AS WELL I.E IT IS NOT AGRICULTURAL. AS REGARD S THE AGRICULTURAL ACTIVITIES NOT CARRIED OUT BY THE ASSESSEE OR ACTI VITIES UNDERTAKEN BY THE BUYER, NO CASE LAW OR ANY OTHER MATERIAL HAS BE EN QUOTED TO DISPEL THE FINDINGS IN THE LOWER APPELLATE PROCEEDINGS. R ATHER, IN CASE LAW I.T.A.NO.152 &378/13 :- 12 -: [2007] 292 ITR 481(MAD) M.S.SRINIVASA NAICKER VS IT O, IT HAS BEEN HELD THAT PURCHASERS ACTIVITY IS IRRELEVANT TO DEC IDE ABOUT THE NATURE OF THE LAND. IN THESE CIRCUMSTANCES, WE AGREE WITH T HE FINDINGS OF THE CIT(A) DELETING THE IMPUGNED ADDITION. THE RELEVAN T GROUND IN REVENUES APPEAL IS DECIDED IN FAVOUR OF THE ASSES SEE. I.T.A.NO.378/MDS/2013 FILED BY THE REVENUE IS DISM ISSED. 17. TO SUM UP, I.T.A.NO.152/MDS/2013 FILED BY THE ASSE SSEE IS PARTLY ALLOWED AND REVENUES APPEAL I.T.A.NO.378/MD S/2013 IS DISMISSED. ORDER PRONOUNCED ON THURSDAY, THE 13 TH OF FEBRUARY, 2014, AT CHENNAI. SD/- SD/- (A. MOHAN ALANKAMONY) ACCOUNTANT MEMBER (S. S. GODARA) JUDICIAL MEMBER DATED: 13 TH FEBRUARY, 2014 RD COPY TO: APPELLANT/RESPONDENT/CIT(A)/CIT/DR