ITO, Ward 3(4), Pune V. Shri Mahesh Ahire, Pune

ITA 346/PUN/2013

• Counselvise Citation: [2017] 127 COUNSELVISE.COM (IT) 9199 (ITAT-PUNE)
• Duration Of Justice: 4 year(s) 5 month(s) 9 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 14-07-2017
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: A
• Next Hearing Date: 21-07-2016
• Assessment Year: 2009-2010
• Appeal Filed On: 04-02-2013
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Assessee Lawyers: HARI KRISHAN
• Keywords: Capital asset
• Section: 143(3); 2(14)

Judgement Text

] IN THE INCOME TAX APPELLATE TRIBUNAL PUNE BENCH A, PUNE BEFORE MS. SUSHMA CHOWLA, JM AND SHRI ANIL CHATURVEDI, AM . / ITA NO.346/PUN/2013 [ [ / ASSESSMENT YEAR : 2009-10 INCOME TAX OFFICER, WARD 3(4), 1 ST FLOOR, PMT BUILDING, SWARGATE, PUNE 411037. . / APPELLANT V/S SHRI MAHESH AHIRE, FLAT NO.4, PINNAK APARTMENTS. S.NO.16/6, ERANDWANA CO-OP SOCIETY, ERANDWANA, PUNE 411 004. PAN : AJHPA1687R. . / RESPONDENT ASSESSEE BY : SHRI HARI KRISHAN REVENUE BY : NONE. / ORDER PER ANIL CHATURVEDI, AM : THIS APPEAL FILED BY REVENUE IS EMANATING OUT OF THE ORDER OF COMMISSIONER OF INCOME-TAX (A) II, PUNE DT.27.09.2012 FOR A.Y. 2009-10. 2. THE RELEVANT FACTS AS CULLED OUT FROM THE MATERIAL ON RECORD ARE AS UNDER :- ASSESSEE IS AN INDIVIDUAL STATED TO BE DERIVING INCOME FROM COMMISSION AND INCOME FROM OTHER SOURCES. ASSESSEE FILED HIS RETURN OF INCOME FOR A.Y. 2009-10 ON 10.08.2009 DECLARING / DATE OF HEARING : 19.04.2017 / DATE OF PRONOUNCEMENT: 14 .07.2017 2 TOTAL INCOME OF RS.1,82,670/-. THE CASE WAS SELECTED FOR SCRUTINY AND THEREAFTER THE ASSESSMENT WAS FRAMED U/S 143(3) VIDE ORDER DT.08.12.2011 AND THE TOTAL INCOME WAS DETERMINED AT RS.3,00,63,360/-. AGGRIEVED BY THE ORDER OF A.O, ASSESSEE CARRIED THE MATTER BEFORE LD.CIT(A) WHO VIDE ORDER DATED 27.09.2012 (IN APPEAL NO.PN/CIT(A)-II/ITO WD-3(4)/145/2011- 12) GRANTED SUBSTANTIAL RELIEF TO THE ASSESSEE. AGGRIEVED BY THE ORDER OF LD.CIT(A), REVENUE IS IN NOW APPEAL BEFORE US AND HAS RAISED THE FOLLOWING GROUNDS. 1. THE LEARNED COMMISSIONER OF INCOME TAX (APPEALS) ERRED IN HOLDING THAT THE LAND IN QUESTION WAS AGRICULTURAL LAND AND NOT A CAPITAL ASSET WITHIN THE MEANING OF SECTION 2(14) OF THE INCOME TAX ACT 1961. 2. THE LEARNED COMMISSIONER OF INCOME TAX (APPEALS) ERRED IN NOT APPRECIATING THAT NO AGRICULTURAL INCOME WAS DERIVED FROM THE LAND AND OFFERED FOR TAXATION IN ANY OF THE PRIOR YEARS AND NO AGRICULTURAL OPERATIONS WERE CARRIED ON THE LAND CLAIMED TO BE AGRICULTURAL LAND. 3. THE LEARNED COMMISSIONER OF INCOME TAX (APPEALS) ERRED IN NOT APPRECIATING THAT THE INTENTION OF THE ASSESSEE TO HOLD THE SAID LAND WAS TO EARN CAPITAL PROFITS AND THERE WAS NO INTENTION OF ESTABLISHING AGRICULTURAL PRACTICES ON THE SAME. 3. ALL THE GROUNDS BEING INTER CONNECTED ARE CONSIDERED TOGETHER. 4. A.O NOTICED THAT DURING THE YEAR ASSESSEE HAD SOLD LANDS AT VILLAGE KAROSHI, TAL. PEN, DIST. RAIGAD FOR RS.3,08,31,500/-. (THE DETAILS OF LANDS SOLD ARE LISTED AT PAGE 1 OF THE ASSESSMENT ORDER.) AO NOTED THAT THE CAPITAL GAINS EARNED OF RS 2,98,80,688/- FROM SALE OF LAND WAS CLAIMED BY THE ASSESSEE TO BE EXEMPT AS ACCORDING TO THE ASSESSEE THE LAND THAT WAS SOLD WAS NOT AN ASSET U/S.2(14) OF THE ACT. THE ASSESSEE WAS ASKED TO JUSTIFY ITS CLAIM. AO NOTED THAT DESPITE SUFFICIENT OPPORTUNITY GRANTED TO THE ASSESSEE NO SUBMISSIONS WERE FILED BY THE 3 ASSESSEE. AO NOTED THAT THE 7/12 EXTRACT REVEALED THAT THE ONLY GRASS WAS GROWN AND NO AGRICULTURAL CROPS WERE CULTIVATED ON THOSE LANDS. HE WAS THEREFORE OF THE VIEW THAT ON THE DATE OF SALE OF LAND, THE LAND WAS NOT USED FOR AGRICULTURAL PURPOSES AND THEREFORE THE LAND CANNOT BE CONSIDERED AS AGRICULTURAL LAND. AO WAS FURTHER OF THE VIEW THAT THE SALE OF LAND INDICATED THAT ASSESSEE HAD SOLD IT WITH PROFIT MOTIVE. HE ALSO NOTED THAT SINCE THE LAND WAS PURCHASED BY THE ASSESSEE IN NOVEMBER/DECEMBER - 2006 AND SOLD IN JANUARY/FEBRUARY - 2009 AND IN THE ABSENCE OF ANY EVIDENCE OF ANY AGRICULTURAL ACTIVITIES BEING CARRIED OUT ON THE SAID LANDS, THE CLAIM OF THE ASSESSEE OF THE CAPITAL GAINS BEING EXEMPT CANNOT BE ACCEPTED. HE ACCORDINGLY, CONSIDERED THE PROFIT ON SALE OF LAND TO BE SHORT TERM CAPITAL GAINS AND ACCORDINGLY TAXED IT. AGGRIEVED BY THE ORDER OF AO, ASSESSEE CARRIED THE MATTER BEFORE LD.CIT(A), WHO DECIDED THE ISSUE IN FAVOUR OF THE ASSESSEE BY HOLDING AS UNDER : 3.7 IN THE PRESENT CASE THE ASSESSEE PURCHASED A LAND IN THE YEAR 2006 AT VILLAGE KHAROSHI, PEN TALUKA, DIST. RAIGAD. THE APPELLANT HAS CONTENDED THAT CROPS, MANGO, TIMBER, CASHEW ETC. WERE GROWN AS IS EVIDENT FROM THE 7/12 EXTRACT AND, THEREFORE, LAND DID NOT REMAIN UNCULTIVATED TILL THE DATE OF SALE, THE '7/12 EXTRACT INDICATES THAT THE LAND IS IRRIGATED AND CULTIVATED AND ALSO CROPS, MANGO, TIMBER, CASHEW WERE GROWN AND THAT GRASS WAS ALSO GROWN WHICH WAS UTILIZED AS ANIMAL FEED. THE APPELLANT HAS ALSO SUBMITTED THE SALE RECEIPTS OF MANGOES SOLD IN THE MARKET AND THUS HAS DERIVED INCOME FROM ITS PRODUCE. THE SAID INCOME WAS NOT ADEQUATE ENOUGH TO BE MORE THAN THE EXPENDITURE INCURRED AND, THEREFORE, NOT SHOWN IN THE I.T.RETURN. THE POSSESSION OF OTHER AGRICULTURAL LANDS BY THE APPELLANT IS EVIDENCED BY THE BALANCE SHEET FILED BY THE APPELLANT. IT HAS BEEN CONTENDED BY THE APPELLANT THAT HIS FOREFATHERS WERE AGRICULTURIST AND HE HIMSELF IS AN AGRICULTURIST WHILE THE LAND WAS PURCHASED AND THE INTENTION WAS TO USE THE LAND FOR PRODUCING CROPS. 3.8 THE APPELLANT HAS FURTHER CONTENDED THAT THE LAND BELONGS TO AN AGRICULTURAL ZONE, AS PER THE ZONE CERTIFICATE FROM CIRCLE OFFICER, HAMRAPUR, PEN AND WAS SURROUNDED BY HARVESTED LAND. IT HAS BEEN STATED THAT A LAND SITUATED IN VILLAGE AREA; THE NON- AGRICULTURAL USE OF A LAND IS PROHIBITED BY THE GOVERNMENT. IT IS ALSO EXPLAINED THAT THE ENTIRE LAND SOLD WAS CULTIVATED TILL THE TIME 4 OF SALE AND THAT THERE WAS NO INTENTION OF EARNING UNDUE PROFIT BY CONVERSION OF LAND FOR NON- AGRICULTURAL PURPOSES WAS EVER MADE BY THE APPELLANT. THE SAID LAND IS ALSO STATED TO BE 10 KMS AWAY FROM THE MUNICIPAL LIMITS AND THE POPULATION OF THE SAID VILLAGE WAS LESS THAN 5000. THE APPELLANT SUBMITTED THE AFORESAID DOCUMENTS BEFORE THE A.O. TO PROVE THAT THE SAID LAND WAS AN AGRICULTURAL LAND FALLING WITHIN THE PURVIEW OF SECTION 2(14)(III). THE APPELLANT DURING THE APPELLATE PROCEEDINGS HAD ALSO CITED A NUMBER OF CASE LAWS WHILE EXPLAINING THE CIRCUMSTANCES WHICH COULD PROVE THE LAND BEING AGRICULTURAL IN NATURE. THE A.O. HAS NOT DISPUTED THE FOLLOWING FACTS DURING THE COURSE OF ASSESSMENT PROCEEDINGS: 1. LAND BEING AGRICULTURAL LAND SITUATED OUTSIDE THE MUNICIPAL JURISDICTION BEYOND 8KMS AND HAVING POPULATION OF THE RURAL AREA WHERE THE LAND IS SITUATED LESS THAN 10,000. 2. THE SURROUNDING LANDS AND AGRICULTURAL LANDS AS EVIDENT FROM SALE DEED. 3. THE LAND WAS NOT HELD AS STOCK-IN-TRADE OR AS BUSINESS ASSET. 4. THE LAND WAS AGRICULTURAL AT THE TIME OF PURCHASE AND IT REMAINED THE SAME AT THE TIME OF SALE. 5. THE LAND WAS ASSESSED TO LAND REVENUE AND IN THE RECORD OFLAND REVENUE, IT IS CLASSIFIED AS AGRICULTURAL LAND. 3.9 THE AO. HOWEVER, HAS DISPUTED THE FACT THAT THE 7/12 EXTRACT FILED BY THE APPELLANT FOR THE PERIOD INDICATING ONLY GRASS IS GROWN AND NO AGRICULTURAL CROPS WERE GROWN. THEREFORE, IT HAS BEEN HELD BY THE A.O. THAT THE LAND IN QUESTION HAS NOT BEEN USED BY THE APPELLANT FOR AGRICULTURAL PURPOSE, IMMEDIATELY PRECEDING THE DATE OF TRANSFER, AND THE CAPITAL GAIN ARISING SHALL 'NOT BE ELIGIBLE FOR EXEMPTION RELYING ON THE CASE OF, CIT VS BOLA RAMAIAH 174 ITR 154. THE A.O. HAS ALSO RELIED ON OTHER JUDICIAL DECISIONS IN THE CASE OF CWT VS OFFICER IN CHARGE (1976) 105 ITR 133 (SC) AND CIT VS RAJA BENOY KUMAR SAHAS ROY (1957) 32 ITR 466 (SC). THE A.O. HAS ALSO HELD THAT THE INTENTION OF THE APPELLANT WAS NOT TO CULTIVATE THE LAND BUT TO EARN PROFIT BY HOLDING THE LAND. THE AO. HAS ALSO INFERRED FROM THE SALE TRANSACTION THAT THE PURCHASER HAS NOT PURCHASED THE LAND FOR SUCH A HIGH PRICE OF NEARLY 2.6 CRORES FOR THE PURPOSE OF CULTIVATION AND, THEREFORE, THE FUTURE USE OF LAND CAN BE ANYTHING BUT AGRICULTURAL. 3 . 10 THE APPE L LANT ON THE OTHER HAND HAS CONTENDED THAT BY AN AMENDMENT INTRODUCED TO SECTION 2(14) OF THE I , T . ACT , 1961 BY FINANCE ACT, 1970, AGRICULTURAL LAND SITUATED IN ALL THE RURAL AREAS ARE NOT BROUGHT WITHIN THE TAX NET AND DO NOT AUTOMATICALLY BECOME CAPITAL ASSET WITHIN THE MEANING OF THE PROVISION OF SECTION 2(14) OF THE I , T . ACT . THE APPELLANT HAS ALSO QUOTED THE CIRCULAR ISSUED BY THE CBDT EXPLAINING THE PROVISIONS OF THE FINANCE ACT, 1970 WHEREIN IT HAS BEEN CLARIFIED V I DE PARA NO . 30 AS UNDER : . . . . . . .. . . . . . . . . . . . AGRICULTURE LAND SITUATED IN RURAL AR E A I . E . OUTSIDE ANY MUNICIPALITY OR CANTONMENT BOARD HAVING A POPULATION OF LESS THAN TEN THOUSAND ALSO BEYOND THE DISTANCE NOTIFIED BY THE CENTRAL GOVT . FROM THE LIMIT OF ANY 5 SUCH MUNICIPALITY OR CANTONMENT BOARD , WILL CONTINUE TO BE EXCLUDED FROM THE CAPITAL ASSETS .' THE APPELLANT HAS, THEREFORE, CONTENDED THAT THE LAND BEING AGRICULTURAL, IS OUTSIDE THE PURVIEW OF THE CAPITAL ASSET AS CONTEMPLATED IN THE PROVISION SECTION 2(14) OF THE I . T . ACT, 1961. THE APPELLANT HAS ALSO CONTENDED THAT THE A . O. HAD FAILED TO ESTABLISH THAT THE LANDS WERE USED FOR THE PURPOSES OTHER THAN AGRICULTURE AND NO EVIDENCE TO THAT EFFECT HAD BEEN BROUGHT ON RECORD WHICH COULD INDICATE THAT THE LAND HAD BEEN USED FOR NON- AGRICULTURAL PURPOSES. THE APPELLANT IS ALSO SEEN TO HAVE NOT OBTAINED ANY PERMISSION FOR NON-AGRICULTURAL USE OF LAND. 3.11 THE ISSUE, AS TO WHAT CONSTITUTES AGRICULTURAL LAND FOR THE PURPOSES OF WEALTH-TAX OR CAPITAL GAINS TAX OR EVEN FOR THE PURPOSES OF DETERMINATION OF THE CHARACTER OF INCOME FROM SUCH LAND AS TO WHETHER IT IS AGRICULTURAL INCOME OR NOT, IS A MATTER WHICH HAS A LONG HISTORY BUT, ULTIMATELY IT IS A QUESTION OF INFERENCE TO BE DRAWN FROM ALL THE FACTS WITH NONE OF THE TESTS BEING CONCLUSIVE. ONE SUCH TEST IS CLASSIFICATION OF THE LAND IN THE REVENUE RECORDS. ENTRIES IN THE RECORD OF RIGHTS WOULD CONSTITUTE PRIMA FACIE EVIDENCE ABOUT AGRICULTURAL CHARACTER OF THE LAND. SO FAR AS THE ARGUMENT PUT FORTH BY THE A . O. REGARDING THE PURCHASE OF LAND BY THE PURCHASER AT A HIGH PRICE IS CONCERNED, IT HAS BEEN HELD IN THE CASE OF CIT VS MANILAL SOMNATH (1977) 166 ITR 917 (GUJ) THAT THE POTENTIAL NON-AGRICULTURAL VALUE OF THE LAND FOR A PURCHASER WHO MAY BE PREPARED TO PAY A LARGE PRICE WOULD NOT DETRACT FROM ITS CHARACTER AS AGRICULTURAL LAND ON THE RELEVANT DATE OF SALE. THE CASE OF GOPAL C. SHARMA (1994) 209 ITR 946 (BOM) WHEREIN THE HON'BLE COURT STATED THAT THE PROFIT MOTIVE OF THE ASSESSEE SELLING THE LAND WITHOUT ANYTHING MORE BY ITSELF CAN NEVER BE DECISIVE FOR DETERMINATION , OF THE ISSUE AS TO WHETHER THE TRANSACTION AMOUNTED TO AN ADVENTURE IN THE NATURE OF TRADE. IN OTHER WORDS, THE PRICE PAID IS NOT DECISIVE TO SAY WHETHER THE LAND IS AGRICULTURAL OR NOT . IN THE CASE OF CIT VS BORHAT TEA CO. LTD . (1982) IT IS HELD THAT FOR THE PURPOSE OF BEING AGRICULTURAL LAND, ACTUAL AGRICULTURAL OPERATION OR CULTIVATION OR TILLING THEREON IS NOT NECESSARY, IF THE LAND IS OTHERWISE CAPABLE OF AGRICULTURAL OPERATION BEING CARRIED ON THREAT. LD.CIT(A) THEREAFTER CONSIDERED THE VARIOUS DECISIONS CITED IN THE ORDER AND THEREAFTER NOTED AS UNDER : 3.11.6 SO FAR AS THE OBSERVATION MADE BY THE ASSESSING OFFICER THAT THE LAND WAS SOLD APPARENTLY TO A DEVELOPER WHOSE INTENTION IS TO DEVELOP THE LAND FOR NON-AGRICULTURAL PURPOSES AS THE PRICE PAID IS ENORMOUSLY HIGH AND A PRUDENT MAN WOULD NOT PURCHASE SUCH LAND FOR CULTIVATION PURPOSE INDICATES THAT THE FUTURE USE OF LAND IS OTHER THAN AGRICULTURAL. THE COURTS HAVE HELD THAT THE CORRECT TEST TO BE APPLIED IS WHETHER ON THE' DATE OF SALE THE LAND WAS AGRICULTURAL LAND OR NOT. IN THE CASE OF GORDHANBHAI KAHANDAS DALWADI VS CIT (1981) 127 ITR 664 (GUJ), HELD THAT JUST BECAUSE AFTER THE SALE THE PURCHASER WAS GOING TO PUT THE LAND TO NON-AGRICULTURAL USE, DOES NOT MEAN THAT THE LAND CEASED TO' BE AGRICULTURAL LAND ON THE DATE OF SALE. SIMILAR VIEW WAS ALSO EXPRESSED IN THE CASE OF CHOTALAL PRABHUDAS VS CIT (CITED SUPRA), WHEREIN THE GUJARAT HIGH COURT OBSERVED THAT WHAT IT HAD TO CONSIDER WAS NOT WHAT THE PURCHASER DID WITH THE LAND OR 6 WHAT THE PURCHASER WAS SUPPOSED TO DO WITH THE LAND BUT WHAT WAS THE CHARACTER OF THE LAND AT THE TIME OF SALE. IN THE CASE OF M.S. SRINIVAS NAICKER VS ITO (2007) 292 ITR 481 (MAD), IT WAS HELD THAT WERE LAND IS UNDER AGRICULTURAL OPERATION ON THE DATE OF SALE, IT IS TAKEN AS AGRICULTURAL LAND AND IT MATTERS VERY LITTLE HOW THE SUBSEQUENT PURCHASER INTEND LAND IN QUESTION TO BE PUT TO USE. IN THE CASE OF CIT VS MANILAL SOMNATH (SUPRA) ALSO RELIED UPON BY THE A.O. THE GUJARAT HIGH COURT OBSERVED THAT THE POTENTIAL NON-AGRICULTURAL VALUE OF THE LAND FOR WHICH THE PURCHASE MIGHT BE PREPARED TO PAY A LARGE PRICE WOULD NOT DETRACT FROM ITS CHARACTER AS AGRICULTURAL LAND AT THE DATE OF SALE. SIMILARLY, PROFIT MOTIVE IN SEEKING THE LAND WOULD ALSO NOT MAKE ANY DIFFERENCE AS DECIDED IN GOPAL L. SHARMA VS CIT (1994) 209 ITR 946 (BOM). IT IS IN THE LIGHT OF THE GUIDELINES AVAILABLE FROM THE DECISIONS THAT THE HON'BLE HIGH COURT OF BOMBAY UPHELD THE FINDING OF THE TRIBUNAL IN RESPECT OF THE ASSESSEE'S CLAIM THAT THE LAND WAS AGRICULTURAL SO THAT THERE IS NOT LIABILITY FOR CAPITAL GAINS TAX AS HELD IN CIT VS MINGUEL CHANDRA PAIS & OTHERS (2006) 282 ITR 618 (BOM). THUS IT CAN BE INFERRED THAT THE PRICE PAID IS NOT A DECISIVE FACTOR TO DECIDE AS TO WHETHER THE LAND IS AGRICULTURAL OR NOT AND THE TOTALITY OF THE CIRCUMSTANCES NEEDS TO BE CONSIDERED BEFORE ARRIVING AT ANY CONCLUSION. 3.12 ON TAKING A BROADER OVERVIEW OF THE ENTIRE FACTS OF THE CASE, TO DECIDE AS TO WHETHER A PIECE OF LAND IS AGRICULTURAL IN CHARACTER IS ESSENTIALLY A QUESTION OF FACT TO BE DETERMINED BY THE CUMULATIVE EFFECT OF ALL THE RELEVANT FACTORS. THE APPELLANT HAS ESTABLISHED BY COGENT AND RELIABLE EVIDENCE THAT THE LAND WAS BEING USED AS AGRICULTURAL LAND OR WAS CAPABLE OF BEING SO USED. THE 7/12 EXTRACT ALSO INDICATES THAT AGRICULTURAL OPERATIONS WERE CARRIED OUT ON THE SAID LAND SINCE 1993. THEREFORE, THE LAND WHICH IS AGRICULTURAL FOR THE PAST SO MANY YEARS COULD NOT BECOME NON-AGRICULTURAL ONLY BECAUSE NO AGRICULTURAL OPERATIONS WERE CARRIED OUT AND ONLY GRASS WAS GROWN AS HELD BY THE AO. INFACT THE AFORESAID FINDING OF THE AO. IS FACTUALLY NOT CORRECT AS EVIDENT FROM THE 7/12 EXTRACT OF THOSE LANDS SOLD BY THE APPELLANT. THE LANDS ARE IRRIGATED, CULTIVATED ' LAND AS MENTIONED ON 7/12 EXTRACT AND THE APPELLANT HAS ALSO GROWN MANGO TREES, TIMBER, CASHEW ETC. AND ALSO UTILIZED THE GRASS AS A CATTLE FEED. THE APPELLANT HAD NEITHER CONVERTED NOR MADE ANY PLAN TO CONVERT NOR TAKEN STEPS TOWARDS THE CONVERSION OF LAND INTO NON- AGRICULTURAL LAND. IT HAS ALSO BEEN SEEN THAT THE PRICE PAID IS NOT DECISIVE FOR ASCERTAINING THE LAND TO BE AGRICULTURAL OR NOT. THUS THE FACTS IF TAKEN IN TOTALITY PROVE THE LANDS ARE AGRICULTURAL LAND. THE CASE LAWS RELIED UPON BY THE A.O. HAS BEEN CONSIDERED IN SEVERAL DECISIONS WHICH HAVE BEEN CITED AND DISCUSSED ABOVE. THE CASE OF SARIFABIBI MOHD IBRAHIM CITED ABOVE OF THE APEX COURT HAS CONSIDERED SEVERAL DECISIONS INCLUDING THOSE RELIED UPON BY THE AO. SIMILARLY, THE CASE OF CWT VS OFFICER-IN-CHARGE, OF THE APEX COURT AND CIT VS. BOLA RAMAIAH, 174 ITR 154 (SC) CITED BY THE A.O. HAS ALSO BEEN CONSIDERED BY THE SUBSEQUENT JUDICIAL PRONOUNCEMENT WHICH HAVE BEEN DISCUSSED IN THE PRECEDING PARAS. 3.13. THEREFORE, AFTER CONSIDERING THE DECISION OF THE JURISDICTIONAL BOMBAY HIGH COURT AND THE PUNE ITAT AS ALSO THE SUPREME COURT DECISION AS WELL AS THE ENTIRE FACTS ON RECORD, THE ADDITION MADE BY THE A.O. IS DIFFICULT TO BE SUSTAINED AND THE LAND IN QUESTION IS HELD TO BE NOT A CAPITAL ASSET WITHIN THE MEANING OF SECTION 2(14)(III) OF THE I.T. ACT, 1961. THEREFORE, THE ADDITION MADE BY THE ASSESSING OFFICER OF RS. 2,98,80,688/- AS SHORT TERM CAPITAL GAIN IS LIABLE TO BE DELETED AND GROUND OF APPEAL NO. 1 IS TREATED AS ALLOWED. 7 AGGRIEVED BY THE ORDER OF LD.CIT(A), REVENUE IS NOW IN APPEAL BEFORE US. 5. ON THE DATE OF HEARING NONE APPEARED ON BEHALF OF THE REVENUE. THE ADJOURNMENT APPLICATION FILED BY THE REVENUE WAS REJECTED BECAUSE THE MATTER WAS ADJOURNED ON SEVERAL OCCASIONS IN THE PAST AT THE REQUEST OF ASSESSEE AND REVENUE. WE THEREFORE PROCEED TO DISPOSE OF THE APPEAL ON THE BASIS OF MATERIAL ON RECORD AND AFTER CONSIDERING THE SUBMISSIONS MADE BY LD.A.R. 6. BEFORE US, LD.A.R. REITERATED THE SUBMISSIONS MADE BEFORE LD.CIT(A) AND SUBMITTED THAT LD.CIT(A) BY DETAILED ORDER HAS ALLOWED THE APPEAL OF THE ASSESSEE. HE THEREFORE SUBMITTED THAT NO INTERFERENCE TO THE ORDER OF LD.CIT(A) IS CALLED FOR . 7. WE HAVE HEARD THE LD.A.R. AND PERUSED THE MATERIAL ON RECORD. THE ISSUE IN THE PRESENT CASE IS WITH RESPECT TO THE ISSUE OF TAXABILITY OF GAINS ON THE SALE OF LAND. WE FIND THAT LD.CIT(A) AFTER CONSIDERING VARIOUS CASE LAWS CITED IN THE ORDER HAS GIVEN A FINDING THAT THE 7/12 EXTRACT FURNISHED BY THE ASSESSEE INDICATED THAT THE LAND THAT WAS SOLD BY ASSESSEE IS IRRIGATED AND CULTIVATED AND VARIOUS CROPS WERE GROWN AND THE GRASS WAS ALSO GROWN AND UTILIZED AS ANIMAL FEED. ASSESSEE ALSO SUBMITTED THAT THE SALES RECEIPTS OF THE MANGOES SOLD IN THE MARKET AND SINCE THE INCOME WAS MORE THAN THE EXPENDITURE INCURRED, IT WAS NOT SHOWN IN THE INCOME TAX RETURN. HE HAS FURTHER GIVEN A FINDING THAT THE POSITION OF OTHER AGRICULTURAL LANDS IS REFLECTED IN THE BALANCE-SHEET FILED BY THE ASSESSEE. HE HAS FURTHER GIVEN A FINDING THAT ASSESSEE WITH THE HELP COGENT AND RELIABLE EVIDENCES 8 HAS BEEN ABLE TO PROVE THAT THE LAND WAS USED FOR AGRICULTURAL PURPOSE AND AGRICULTURAL OPERATIONS WERE ALSO CARRIED OUT IN THE SAID LAND SINCE 1993. HE HAS FURTHER NOTED THAT THE OBSERVATION OF AO REGARDING NON-AGRICULTURAL OPERATIONS CARRIED ON THE SAID LANDS WAS NOT CORRECT IN THE LIGHT OF THE EVIDENCE 7/12 EXTRACT FURNISHED BY THE ASSESSEE. BEFORE US, THE REVENUE HAS NOT PLACED ANY MATERIAL TO CONTROVERT THE FINDINGS OF LD.CIT(A) NOR POINTED OUT ANY FALLACY IN THE FINDINGS OF LD.CIT(A). WE THEREFORE FIND NO REASON TO INTERFERE WITH THE ORDER OF LD.CIT(A). THUS, THE GROUNDS OF REVENUE ARE DISMISSED. 8. IN THE RESULT, APPEAL OF THE REVENUE IS DISMISSED. ORDER PRONOUNCED ON 14 TH JULY, 2017. SD/- SD/- ( SUSHMA CHOWLA ) ( ANIL CHATURVEDI ) / JUDICIAL MEMBER / ACCOUNTANT MEMBER PUNE; DATED : 14 TH JULY, 2017. YAMINI / COPY OF THE ORDER FORWARDED TO : 1. / THE APPELLANT 2. / THE RESPONDENT 3 . 4. 5. 6. CIT(A)-II, PUNE CIT-II, PUNE. , , / DR, ITAT, A PUNE; [ / GUARD FILE. / BY ORDER , // / TRUE COPY // COPY// / SR. PRIVATE SECRETARY , / ITAT, PUNE