I.T.O. WARD -3(5), Nagpur V. SHRI SHRI MANOHAR JAIRAMJI WANKHEDE, Nagpur

ITA 399/NAG/2016

• Counselvise Citation: [2017] 128 COUNSELVISE.COM (IT) 7657 (ITAT-NAGPUR)
• Duration Of Justice: 6 month(s) 13 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 11-01-2017
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: SMC
• Assessment Year: 2009-2010
• Appeal Filed On: 28-06-2016
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: A R NINAWE
• Assessee Lawyers: MADHAO VICHORE
• Keywords: Capital asset; Business income
• Section: 148

Judgement Text

1 ITA NO. 399/NAG/2016 . IN THE INCOME TAX APPELLATE TRIBUNAL, NAGPUR BENCH, NAGPUR BEFORE SHRI SHAMIM YAHYA, ACCOUNTANT MEMBER. (S.M.C.) I.T.A. NO. 399 /NAG/2016 ASSESSMENT YEAR : 200 9 - 10 . THE INCOME - TAX OFFICER, SHRI MANOHAR JAIRAMJI WANKHEDE, WARD - 3(5), NAGPUR. VS. MOHGAON, NAGPUR. PAN A BGPW8158G. APPELLANT. RESPONDENT. APPELLANT BY : SHRI A.R. NINAWE. RESPONDENT BY : SHRI MADHAO VICHORE. DATE OF HEARING : 2 0 - 12 - 2016 DATE OF PRONOUNCEMENT : 11 TH JANUARY, 2017. O R D E R. T HIS APPEAL BY THE R EVENUE IS DIRECTED AGAINST ORDER OF L EARNED CIT(APPEALS) - II, NAGPUR DATED 0 1/ 0 4/2016 AND PERTAINS TO ASSESSMENT YEAR 2009 10. THE GROUNDS OF APPEAL READ AS UNDER : 1. ON THE FACTS AND CIRCUMSTANCES OF THE CASE , THE W. CIT(A) ERRED IN HOLDING THAT THE GAIN OUT OF SALE OF AGRICULTURAL LANDS HAS WRONGLY BEEN TREATED AS ADVENTURE IN NATURE OF TRADE BY THE ID. AO AND DELETING THE ADDITION MADE OF RS . 43,50,OOO / - . 2. ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE THE LD. CIT(A) ERRED IN OBSERVING THAT THE AGRICULTURE LANDS IN QUESTION HAD BEEN TRANSFERRED TO THE ASSESSEE AND HE IS NOW THE OWNER OF THE AGRICULTURAL LANDS AND CONSEQUENTLY POSSESSES THE RIGHT TO SELL I T WITHOUT APPRECIATING THAT PARTING OF POSSESSION ON THE BASIS OF AGREEMENTS TO SELL DID NOT TANTAMOUNT TO PARTING OF OWNERSHIP WHICH REMAINED WITH THE ORIGINAL OWNERS. 3. ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE THE LD . CIT(A) ERRED IN OBSERVING T HAT THE ASSESSEE IS AN AGRICULTURIST WHO WAS ENGAGED IN AGRICULTURAL ACTIVITIES IN THE SAID AGRICULTURAL LANDS WITHOUT APPRECIATING THAT 2 ITA NO. 399/NAG/2016 . THE LAND AT KIRMITI WAS USED ONLY FOR GRAZING PURPOSE AND AN ACTIVITY OF GROWING GRASS WOULD NOT MAKE THE ASSESSEE AN AGRICULTURIST . 4. ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE THE LD . CIT(A) ERRED IN OBSERVING THAT THE ASSESSEE IS AN AGRICULTURIST WHO WAS ENGAGED IN AGRICULTURAL ACTIVITIES IN THE SAID AGRICULTURAL LANDS WITHOUT APPRECIATING THAT THE LAND AT TUMUDI AS MENTIONED IN THE AGREEMENT WAS GIVEN TO CARRY OUT DEVELOPMENT ACTIV ITY AND TO OBTAIN PERMISSION FROM TOWN PLANNING FOR DEVELOPING A LAYOUT OF PLOTS AND NO PROOF OF ANY AGRICULTURAL ACTIVITY WAS SUBMITTED BY THE ASSESSEE ON THIS LAND. 5. ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE THE LD. CIT(A) ERRED IN NOT APPLYING THE RATIO OF THE DECISION OF HONBLE SUPREME COURT GIVEN IN THE CASE OF G. VENKATSWAMI NAIDU AND CO. VS. CIT REPORTED IN 35 ITR 594 TO THE FACTS OF THIS CASE WHICH GAIN WAS DERIVED OUT OF THE SALE OF AGRICULTURAL LANDS WAS AN ADVENTURE IN THE NATURE OF TRA DE. 2. B RIEF FACTS OF THE CASE ARE AS UNDER : 2. INFORMATION WAS RECEIVED BY THE AO THAT THE A SSESSEE , A LONG WITH ONE SHRI NAUSHANL , ACTED AS A CONSENTER IN A TRANSACTION RELATING TO TRANSFER OF LAND SITUATED AT MAUZA KIRMITI AND HAD R ECE I VED AN AMOUNT OF RS. 12 , 50,000/ - WITH REGARD TO THE SAME ON 21/06/2008 . THE AO FURTHER NOTED THAT NO RETURN OF I NCOME HAD BEEN FILED BY THE A SSESSEE FOR A . Y . 2009 - 10 AND HE THEREFORE ISSUED A NOTICE U/S 148 OF THE INCOME TAX ACT. THE A SSESSEE FILED THE RETURN OF INCOME FOR ASSESSMENT YEAR 2009 - 10 ON 25/03/2014 DECLARING NIL INCOME . THE AO REQU I RED THE ASSESSEE TO FURN I SH DETAILS RELAT I NG TO . LAND TRANSACTIONS ENTERED INTO DURING THE YEAR UNDER CONSIDERATION . IT WAS SEEN THAT THE A SSESSEE HAD ENTERED I NTO TWO LAND TRANSACTIONS AS PER THE DETAILS BELOW : 3 ITA NO. 399/NAG/2016 . SR. NO. NAME OF PARTY TO WHOM SALE MADE. LOCATION. VALUE REMARKS. 1. ABHAY NIMJE. MOUZA: KIRMITI TEHSIL: HINGNA, DISTRICT: NAGPUR. 50,00,000 50% 2. VIVEK KUNAWAR ETC. MOUZA : TUMDI TEHSIL :NAGPUR DISTRICT: NAGPUR. 93,00,000 1/3 SHARE. 3. THE DETAILS OF PURCHASE PARTY AND SALE PARTY AND DETAILS RELATING TO THE AGREEMENT TO SALE HAVE BEEN DULY REPRODUCED BY THE AO ON PG . 2 OF THE ASSESSMENT ORDER . ON PERUSAL OF THE SAID DETAILS IT WAS NOTED BY THE AO THAT THE A SSESSEE HAD RECEIVED A CONSIDERATION OF RS. 43,50,000/ - IN HIS CAPACITY AS A CONSENTER TO THE TWO LANDS TRANSACTIONS AND SHE THEREFORE REQUIRED THE A SSESSEE TO EXPLAIN AS TO WHY THE SAID AMOU NT SHOULD NOT BE TREATED AS HIS INCOME . 4. IT WAS EXPLAINED BY THE A SSESSEE T THAT HE HAD SOLD TWO AGRICULTURAL LANDS DURING THE YEAR UNDER CONSIDERATION AND IN BOTH THE TRANSACTIONS, SUBSEQUENT TO THE AGREEMENT TO SALE, POSSESSION OF THE PROPERTIES WAS T RANSFERRED TO THE A SSESSEE . IT WAS EXPLAINED THAT THOUGH THE SALE WAS MADE DIRECTLY BY THE ORIGINAL OWNER TO THE SALE PARTY, SINCE THE A SSESSEE HAD TAKEN POSSESS I ON OF THE PROPERTIES , HE WAS THE DE FACTO OWNER OF THE SAID PROPERTIES AND HAD EXECUTED THE SA LE DEED I N HIS CAPACITY AS A CONSENTER . IT WAS A CONTENTION OF THE A SSESSEE THAT SINCE HE (ALONG WITH C O - OWNERS) HAD TAKEN POSSESSION OF THE PROPERTIES, THE LANDS STOOD TRANSFERRED TO THE A SSESSEE . HE FURTHER SUBMITTED THAT AND SINCE HE WAS THE OWNER OF T HE SAID L ANDS , AND ALSO SINCE THE SAID LANDS WERE RURAL 4 ITA NO. 399/NAG/2016 . AGR I CULTURAL LAND BEYOND 8 KMS . FROM THE MUN IC IPAL LIMITS, NO TAX WAS PAYABLE ON THE SAID INCOME. 5. THE AO CONSIDERED THE SUBM I SS I ONS OF THE A SSESSEE BUT DID NOT AGREE WITH THE SAME AND ADDED THE SAID AMOUNT OF RS. 43,50,000/ - TO THE INCOME OF THE A SSESSEE AND HELD THE SAID ACTIVITY TO BE AN ADVENTURE IN THE NATURE OF BUSINESS. AGGRIEVED BY THE SAME THE ASSESSEE APPE ALED BEFORE THE LEARNED CIT(APPEALS) . 6 . UPON ASSESSEE'S APPEAL L EARNED CIT(APPEALS) ELABORATELY CONSIDERED THE ISSUE. HE OBSERVED AS UNDER : 5. I HAVE CONSIDERED THE FACTS OF THE CASE AND SUBMISSIONS OF THE APPELLANT . I HAVE ALSO PERUSED THE REMAND REPORT AND THE RESPONSE OF THE APPELLANT TO THE REMAND REPORT . IT IS NOTED THAT THE LD . AO HAS ADDED THE SAID AMOUNT OF RS. 43,50,000/ - TO THE INCOME OF THE APPELLANT FOR THE FOLLOWING REASONS: (A) THAT THE LAND SITUATED IN MOUZA KIRMITI IS NOT AGRICULTURAL LAND AND HAS BEEN CATEGORI ZED AS 'BARREN AND CHARAI' AS PER THE 7/12 EXTRACTS . (B) THAT THE ASSESSEE IS NOT THE OWNER OF THE LANDS SOLD AND THAT HE HAS NOT EXECUTED THE SALE DEED IN RESPECT OF LAND IN WHICH HE HAS MADE AGREEMENT TO SALE. IT IS THE CASE OF THE LD . AO THAT HE HAS O NLY TRANSFERRED HIS RIGHT TO PURCHASE THE SAID AGRICULTURAL LAND . (C) THAT THE APPELLANT HAS HELD THE TWO LANDS FOR A SHORT PER I OD OF TIME AND , . THE INTENTION OF THE APPELLANT WAS TO EARN PROFIT AND THAT THEREFORE THE INCOME IS REQUIRED TO BE ASSESSED AS ADVENTURE IN THE NATURE OF BUSINESS . 6. COMING TO THE FIRST CONTENTION OF THE LD. AO THAT THE KLRMITI LAND IS ' BARREN AND CHARAI' , IT I S . SEEN THAT THE ID . AO CAME TO THE SAID CONCLUSION AS PER THE 7/12 EXTRACTS SUBMITTED BY THE APPELLANT FOR ASSESSME NT YEAR 2007 - 08 & 2008 - 09. THE APPELLANT SUBSEQUENTLY FURNISHED 7/12 EXTRACTS FROM FY 1998 - 99 TO FY 2009 - 10 EVIDENCE TO ESTABLISH THAT THE SAID LAND IS BASICALLY AGRICULTURAL LAND THOUGH IT WAS USED FOR THE PURPOSE OF CHARAI (GRAZING) DURING THE YEAR UNDER CONSIDERATION . 6.1 ON PERUSAL OF THE 7/12 EXTRACTS AS WELL AS THE REMAND REPORT OF THE LD. AO IT BECOMES EVIDENT THAT THE LAND IN QUESTION IS FUNDAMENTALLY AGRICULTURAL IN NATURE AND HAS BEEN REGULARLY USED FOR CULTIVATION AND OTHER 5 ITA NO. 399/NAG/2016 . AGRICULTURAL PURPOSE FROM THE PERIOD F.Y. 1998 - 99 TO 2006 - 07. VARIOUS CROPS SUCH AS SOYABEAN, GRAM, COTTON ETC., HAVE BEEN REGULARLY CULTIVATED ON THE SAID LAND AND HENCE THERE IS NO BASIS TO COME TO THE CONCLUSION THAT THE SAID LAND IS BARREN AND NOT AGRICULTURAL. EVEN DURIN G THE YEAR UNDER CONSIDERATION IT IS SEEN THAT THE APPELLANT HAS BEEN CARRYING OUT CHARAI (GRAZING) ACTIVITY IN PART OF THE SAID AGRICULTURAL LAND AND SINCE NO INCOME HAS BEEN EARNED FROM THE SAID AGRICULTURAL ACTIVITY, THE SAME HAS NOT BEEN SHOWN IN THE RETURN OF INCOME. 6.2 FURTHER AS POINTED OUT BY THE APPELLANT, THERE IS SIGNIFICANT DIFFERENCE BETWEEN THE WORD 'PADIT' (AS MENTIONED IN THE 7/12 EXTRACTS) AND THE WORD 'BARREN' (AS USED BY THE LD. AD). THE WORD BARREN MEANS LAND THAT IS PHYSICALLY UNFER TILE WHILE THE WORD PADIT MEANS LAND THAT IS CAPABLE FOR CULTIVATION BUT WHICH IS LYING UNCULTIVATED. THUS THE CONCLUSION OF THE ID. A O THAT THE LAND IS BARREN IS ERRONEOUS AND NOT BORNE OUT BY THE CLEAR FACTS BROUGHT ON RECORD. THE L AND IS EVIDENTLY AGRICULTURAL IN NATURE. DURING THE YEAR UNDER CONSIDERATION IT HAS BEEN USED FOR GRAZING. IT IS ALSO NOT DISPUTED THAT THE SAID LAND IS BEYOND 8 KMS. FROM THE MUNICIPAL LIMITS. 6 . 3 WITH REGARD TO THE TUMDI LAND, IT IS SUBMITTED BY THE APP ELLANT THAT THE ID. AD HAS NOT COMMENTED ABOUT THE NATURE OF THE LAND. THE SAME . IS THEREFORE ADMITTEDLY AGRICULTURAL IN NATURE AND IS ALSO SITUATED BEYOND 8 KMS. FROM THE MUNICIPAL LIMITS. 6 . 4 THUS IT MAY BE CONCLUDED THAT BOTH THE LANDS IN QUESTION ARE AGRICULTURAL LANDS SITUATED BEYOND 8 KMS FROM THE MUNICIPAL LIMITS. 7. WITH REGARD TO THE SECOND ISSUE IT IS SEEN THAT AS PER SECTION 2{ 14) OF THE INCOME TAX ACT, 'CAPITAL ASSET' MEANS PROPERTY OF ANY KIND HELD BY AN ASSESSEE, WHETHER OR NOT CONNECTED WITH HIS BUSINESS OR PROFESSION, BUT DOES NOT INCLUDE . . . THUS THE DEFINITION OF THE CAPITAL ASSET LAYS EMPHASIS ON THE FACT THAT THE PROPERTY IN QUESTION SHOULD BE 'HELD BY' THE ASSESSEE. IN THE CASE UNDER CONSIDERATI ON THE PROPERTY WAS CLEARLY HELD BY THE APPELLANT IN VIEW OF THE FACT THAT THE POSSESSION OF THE SAID PROPERTY WAS HANDED OVER AGAINST P AYMENTS OR AGAINST PROMISE TO MAKE PAYMENTS ALTHOUGH THE REGISTRATION OF BOTH THE PROPERTIES RE M A I NED IN THE NAME OF THE TRANSFEROR. IT IS IMPORTANT TO NOTE THAT TRANSFER OF IMMOVABLE PROPERTY CAN TAKE PLACE FOR FOLLOWING TWO METHODS: WHERE CONVEYANCE DEED IS REGISTERED AND WHERE CONVEYANCE DEED IS NOT REGISTERED. 7.1 WHERE THE CONVEYANCE DEED IS NOT REGISTERED THE TRANSFE R WOULD BE GOVERNED BY PROVISIONS OF SECTION 2(47)(V). IT IS NOT DISPUTED HAT CERTAIN AMOUNTS HAVE BEEN PAID BY THE APPELLANT IN RESPECT OF THE SAID LANDS. IT IS ALSO UNDISPUTED THAT THE POSSESSION OF THE LAND IN QUESTION WAS HANDED OVER TO THE APPELLANT D URING THE YEAR UNDER CONSIDERATION. IN THE LIGHT OF THESE FACTS, IT IS PERTINENT TO GO THROUGH THE RELEVANT PROVISIONS OF SECTION 2(47) OF THE INCOME TAX ACT, 1961 : 6 ITA NO. 399/NAG/2016 . '2(47) 'TRANSFER', IN RELATION TO A CAPITAL ASSET, INCLUDES, - (I) . .. (V) ANY TRANSACTION INVOLVING THE ALLOWING OF THE POSSESSION OF ANY IMMOVABLE PROPERTY TO BE TAKEN OR RETAINED IN PART PERFORMANCE OF A CONTRACT OF THE NATURE REFERRED TO IN SECTION 53A OF THE TRANSFER OF PROPERTY ACT, 1882' 7.2 SECTION 5 . 3A OF THE TRANSFER OF PROPERTY ACT ENVISAGES SITUATIONS WHERE UNDER A CONTRACT FOR TRANSFER OF AN IMMOVABLE PROPERTY, THE PURCHASER HAS PA I D THE PRICE AND HAS TAKEN POSSESSION OF THE PROPERTY, BUT THE CONVEYANCE IS EITHER NOT EXECUTED OR IF EXECUTED IT IS NOT REGISTERED. IN SUCH CASES, THE TRANSFEROR IS DEBARRED FROM AGITATING HIS TITLE TO THE PROPERTY AGAINST THE PURCHASER. 7.3 AS PER THE PROVISIONS OF SECTION 2(4 7)(V) R. W .S. SECTION 53A OF THE TRANSFER OF PROPERTY ACT, 1882, IT IS SEEN THAT WHEN POS SESSION HAS BEEN ALLOWED OF ANY IMMOVABLE PROPERTY IN PART PERFORMANCE OF A CONTRACT, THEN IT AMOUNTS TO TRANSFER OF CAPITAL ASSET. IN THE PRESENT CASE, THE POSSESSION HAS BEEN GIVEN TO THE APPELLANT IN THE PRESENT YEAR, CONTRACT HAS BEEN ENTERED INTO WITH THE SELLER AS PER WHICH PRICE HAD BEEN FIXED AND SIGNIFICANT PAYMENT WAS ALSO BEEN MADE BY THE APPELLANT AND HENCE ALL THE REQUIREMENTS OF SECTION 2( 47)(V) OF INCOME TAX ACT, 1961 AS WELL AS SECTION 53A OF TRANSFER OF PROPERTY ACT ARE FULFILLED AND THERE FORE, IT HAS TO BE CONCLUDED THAT THE PROPERTY IN QUESTION HAD BEEN TRANSFERRED TO THE APPELLANT AND . HE IS NOW THE OWNER OF THE PROPERTY AND CONSEQUENTLY POSSESSES THE RIGHT TO SELL IT. THUS THERE IS NO MERIT IN THE CONTENTION OF THE LD. AO AND THE APPELLANT HAS NOT EXECUTED THE SALE DEEDS AND THAT THEREFORE THE APPELLANT IS MERELY A CONSENTER AND THAT THE APPELLANT WAS NOT THE OWNER OF THE SAID AGRICULTURAL LANDS. 7 . 4 THUS SINCE THE SAI D AGRICULTURAL LAND STANDS TRANSFERRED TO THE APPELLANT, ANY SURPLUS ARISING TO THE APPELLANT ON TRANSFER OF SUCH AGRICULTURAL LAND WOULD BE SUBJECT TO CAPITAL GAIN IF THE SAME IS SITUATED WITHIN 8 KMS. FROM THE MUNICIPAL LIMITS AND ALTERNATIVELY WOULD BE EXEMPT FROM CAPITAL GAIN IF THE SAME IS SITUATED BEYOND 8 KMS. FROM THE MUNICIPAL LIMITS. IN THE CASE UNDER CONSIDERATION, THE SAID PROPERTY IS ADMITTEDLY SITUATED BEYOND 8 KMS. FROM THE MUNICIPAL LIMITS AND WOULD THEREFORE BE EXEMPT FROM CAPITAL GAIN TAX . 8. WITH REGARD TO THE THIRD CONTENTION OF THE ID. AO OF TREATING THE INCOME AS ADVENTURE IN THE NATURE OF TRADE, THE SAID ISSUE HAS BEEN A MATTER OF MUCH DEBATE AND IS NOW SETTLED BY VARIOUS CASE LAWS. THERE ARE VARIOUS JUDICIAL PRONOUNCEMENTS WHEREIN IT HAD BEEN HELD THAT THE SALE CONSIDERATION OUT OF SALE OF AGRICULTURAL LAND IS NOT ASSESSABLE AS BUSINESS INCOME WHEN SUCH AGRICULTURAL LAND IS SITUATED BEYOND 8 KMS. AND THAT IT IS NOT IMPORTANT WHETHER THERE WAS ANY AGRICULTURAL INCOME OR NOT AND THAT THE MOOT QUESTION TO DECIDE THE ISSUE IS WHETHER THE CHARACTER OF THE LAND I S AGRICULTURAL OR NOT. IT HAS ALSO NOT BEEN HELD THAT ANY CONSIDERATION RECEIVED OUT OF SALE OF AGRICU L TURAL LAND CANNOT BE TREATED AS BUSINESS INCOME. 7 ITA NO. 399/NAG/2016 . 7 . THEREAFTER LEARNED CIT (APPEALS) REFERRED TO SEVERAL CASE LAWS. THE L EARNED CIT (APPEALS) CONCLUDED AS UNDER : THUS THE CRUCIAL QUESTION IS TO DETERMINE WHETHER THE CHARACTER OF THE LAND IS AGRICULTURAL OR NOT. IF THE LAND IS AGRICULTURAL AND BEYOND 8 KMS., SALE CONSIDERATION HAS TO BE HELD TO BE NOT TAXABLE. IN THE CASE OF THE APPELLANT IT IS AN UNDISPUTED FACT THAT THE LANDS IN QUESTION ARE AGRICULTURAL LANDS. THE FACT THAT THE APPELLANT TOOK DELIVERY OF THE SAID LAND IS NOT DISPUTED AND HENCE IT IS AN ACCEPTED FACT THAT THE SAID AGRICULTURAL LAND STOOD TRANSFERRED IN THE NAME OF THE APPELLANT. THUS CLEARLY, AT THE TIME OF TAKING POSSESSION A ND AT THE TIME OF SALE, THE SAID LANDS WERE CLASSIFIED AS AGRICULTURAL LAND IN THE REVENUE RECORDS. IT IS ALSO AN ADMITTED FACT THAT NEIT HER THE APPELLANT NOR ANY EARLIER OWNER EVER SOUGHT ANY CONVERSION OF THE SAID LANDS FOR ANY NON - AGRICULTURAL USE. THE PERUSAL OF 7/12 EXTRACTS CLEARLY ESTABLISHES THAT AGRICULTURAL ACTIVITY HAS BEEN CARRIED OUT IN THE SAID LANDS. IT IS ALSO NOT DISPUTED T HAT THE SAME ARE LOCATED BEYOND 8 KMS FROM THE CITY MUNICIPAL LIMITS. THUS IT IS A FACT THAT THE APPELLANT IS AN AGRICULTURIST WHO WAS ENGAGED IN AGRICULTURAL ACTIVITIES IN THE SAID AGRICULTURAL LANDS THAT ARE BEYOND 8 KMS FROM THE MUNICIPAL LIMITS OF NAGP UR. RESPECTFULLY FOLLOWING THE DECISIONS QUOTED ABOVE IT IS HELD THAT THE GAIN OUT OF THE SALE OF THE AGRICULTURAL LANDS HAS WRONGLY BEEN TREATED AS ADVENTURE IN THE NATURE OF TRADE BY THE LD. AO AND THE ADDITION MADE OF RS.43,50,000/ - IN THIS RESPECT IS D IRECTED TO BE DELETED. 8 . AS A GAINST THE ABOVE ORDER R EVENUE IS IN APPEAL BEFORE THE ITAT 9 . I HAVE HEARD BOTH THE COUNSEL AND PERUSED THE RECORDS. I FIND THAT THE A SSESSING O FFICER HAS DRAWN ADVERSE INFERENCE ON ACCOUNT OF LACK OF APPRECIATION OF THE FACTS. THE A SSESSING O FFICER HAS RELIED UPON THE DESCRIPTION IN THE 7/12 EXTRACTS TO HOLD THAT THE LAND WAS NOT AGRICULTURAL. HE HAS ALSO DRAWN ADVERSE INFERENCE ON ACCOUNT OF TH E AGREEMENT OF SALE EXECUTED BY THE ASSESSEE AND THE PERIOD FOR WHICH THE LAND WAS H EL D BY THE ASSESSEE. THE LEARNED CIT (APPEALS) HAS ELABORATELY CONSIDERED ALL THE ASPECTS OF THE A SSESSING O FFICER'S ADVERSE INFERENCE. HIS ELABORATE FINDINGS ARE COGENT AND FULLY 8 ITA NO. 399/NAG/2016 . SUSTAINABLE. THE RELIANCE UPON VARIOUS CASE LAWS INCLUDING THAT FROM THE JURISDICTIONAL HIGH COURT IN THE CASE OF CIT VS SMY DEBBIE ALEMAO IN 331 ITR 59 FULLY SUPPORT HIS FINDINGS. ACCORDINGLY I DO NOT FIND ANY INFIRMITY IN THE SAME. HENCE I UPHOLD THE ORDER OF L EARNED CIT(APPEALS) . 10 . IN THE RESULT THIS APPEAL FILED BY THE R EVENUE STANDS DISMISSED. ORDER PRONOUNCED IN THE OPEN COURT ON THIS 11 TH DAY OF JANUARY., 2017. SD/ - ( SHAMIM YAHYA) ACCOUNTANT MEMBER. NAGPUR, DATED: 11 TH JANUARY, 2017. COPY FORWARDED TO : 1. SHRI MANOHAR JAIRAMJI WANKHEDE, MOHGAON, NAGPUR - 441108. 2. I.T.O., WARD - 3(5), NAGPUR. 3. PR. C.I.T. - I I , NAGPUR. 4. CIT(APPEALS), - I I , NAGPUR. 5. D.R., ITAT, NAGPUR. 6. GUARD FILE TRUE COPY BY ORDER ASSISTANT REGISTRAR, INCOME TAX APPELLATE TRIBUNAL, NAGPUR BENCH, NAGPUR. WAKODE.