The ITO, 5(1), Indore V. Shri Jaspal Singh Chadha, Indore

ITA 478/IND/2012

• Counselvise Citation: 47822714 RSA 2012
• Duration Of Justice: 1 year(s) 1 month(s) 23 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 21-10-2013
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: SB
• Assessment Year: 2009-2010
• Appeal Filed On: 29-08-2012
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: R A VERMA
• Assessee Lawyers: S S SHEETAL
• Keywords: Capital asset; Competent authority; Onus to prove
• Section: 54B; 2(14); 80IB; 133(6)

Judgement Text

1 INCOME TAX APPELLATE TRIBUNAL INDORE BENCH, INDORE BEFORE SHRI JOGINDER SINGH, JUDICIAL MEMBER AND SHRI R.C. SHARMA, ACCOUNTANT MEMBER ITA NO.478/IND/2012 A.Y. 2009-10 INCOME TAX OFFICER 5(1) INDORE :: APPELLANT VS JASPAL SINGH CHADHA INDORE PAN ABMPC 2583M :: RESPONDENT APPELLANT BY SHRI R.A. VERMA RESPONDENT BY SHRI S.S. SHEETAL DATE OF HEARING 3.9.2013 DATE OF PRONOUNCEMENT 3.9.2013 O R D E R PER JOGINDER SINGH, JUDICIAL MEMBER THE REVENUE IS AGGRIEVED BY THE ORDER OF THE FIRS T APPELLATE AUTHORITY DATED 18 TH JUNE, 2012 WHEREIN ADDITION OF RS.62,79,961/- WAS DELETED UNDER THE HEAD LONG TER M CAPITAL GAIN ON ACCOUNT OF INCOME FROM THE SALE OF LAND BY PLACING RELIANCE UPON THE CERTIFICATE ISSUED BY PWD DEPARTM ENT, IGNORING THE CERTIFICATE OF TEHSILDAR BY HOLDING THAT THE LA ND SOLD BY THE 2 ASSESSEE IS NOT A CAPITAL ASSET MERELY ON THE GROUN D THAT IT IS AGRICULTURAL LAND. 2. DURING HEARING OF THIS APPEAL, WE HAVE HEARD SHR I R.A. VERMA, LEARNED SENIOR DR AND SHRI S.S. SHEETAL, LEA RNED COUNSEL FOR THE ASSESSEE. THE CRUX OF ARGUMENTS ON BEHALF OF THE REVENUE IS THAT THE LAND IN QUESTION IS SITUATED IN VILLAGE ARANDIA WHICH IS WITHIN THE MUNICIPAL LIMIT I.E. LESS THAN 8 KM. IT WAS SUBMITTED THAT THE LEARNED CIT(A) IGNORED THE CERTIFICATE ISS UED BY TEHSILDAR. MR. VERMA CONTENDED THAT THE TRIBUNAL H AS DECIDED THAT THE CERTIFICATE OF TEHSILDAR FOR REVENUE PURPO SES IS MORE AUTHENTIC FOR WHICH OUR ATTENTION WAS INVITED TO TH E ORDER DATED 31.8.2012 (ITA NO. 207/IND/2012). RELIANCE WAS AL SO PLACED ON THE DECISION IN SMT. SHARIFA BIBI MOHD. IBRAHIM; 20 4 ITR 631 (SC) BY SUBMITTING THAT THE IMPUGNED LAND IS NOT AN AGRICULTURAL LAND. ON THE OTHER HAND, THE LEARNED COUNSEL FOR T HE ASSESSEE FILED A CERTIFICATE ISSUED BY TEHSILDAR BY PLEADING THAT THE INSPECTOR AS WELL AS TEHSILDAR BOTH HAVE TAKEN THE DISTANCE FROM MR-11 AS PER WHICH THE DISTANCE MORE THAN 8 KM FROM THE MUNICIPAL LIMIT. THE LEARNED SR. DR CONTENDED THAT MR-11 CANNOT BE CONSIDERED FOR THIS PURPOSE. IN REPLY, TH E LEARNED COUNSEL FOR THE ASSESSEE EXPLAINED THAT AT THE TIME OF SALE I.E. 3 1.9.2008, MR-11 WAS NOT IN EXISTENCE AND WAS CONSTR UCTED LATER ON FOR WHICH THE WORK ORDER DATED 16.9.2010 WAS PRO DUCED. THE LEARNED COUNSEL ALSO PRODUCED A MAP ATTESTED BY TEH SILDAR, CERTIFYING THAT THE IMPUGNED LAND IS BEYOND THE PRE SCRIBED LIMIT AND IS 2 KMS AWAY FROM THE BY-PASS ROAD. 3. WE HAVE CONSIDERED THE RIVAL SUBMISSIONS AND PER USED THE MATERIAL AVAILABLE ON RECORD. ON PERUSAL OF RECORD AND AFTER HEARING THE RIVAL SUBMISSIONS, THE FACTS IN BRIEF, ARE THAT THE ASSESSEE DECLARED INCOME OF RS.3,32,740/- IN ITS RE TURN FILED ON 24.9.2009. THE ASSESSING OFFICER RECEIVED INFORMAT ION THAT THE ASSESSEE SOLD IMMOVABLE PROPERTY FOR RS.65 LACS DUR ING THE F.Y. 2008-09 THE COPY OF THE REGISTERED SALE DEED, IN RE SPECT OF THIS TRANSACTION, WAS FURNISHED BEFORE THE ASSESSING OFF ICER. THE ASSESSEE ACQUIRED THIS LAND ON 12.9.1996 FOR RS. 1, 15,313/- AND SOLD FOR RS.65,000/- ON 1.9.2008. THUS, THE ASSESS EE CLAIMED LONG TERM CAPITAL GAIN OF RS.62,79,961/- ON THE SAL E OF SUCH LAND AND CLAIMED THE SAME AS EXEMPT U/S 10(37) OF THE AC T. THE ASSESSEE WAS ASKED TO JUSTIFY THE CLAIMED EXEMPTION . THE ASSESSEE MADE SUBMISSIONS VIDE HIS LETTER DATED 26. 8.2011. THE ASSESSING OFFICER MADE FOLLOWING OBSERVATIONS IN PA RA 5.1 OF THE ASSESSMENT ORDER :- 4 THAT AGRICULTURAL LAND SITUATED INTERIOR OF GRAM ARANDIA PATWARI HALKA NO. 18 THE/DISTT.INDORE. THE AGRICULTURAL LAND IS FAR FROM TEHSIL BORDER BY A DISTANCE MORE THAN 8 KM. REGARDING DISTANCE ALSO SUBMITTED RAILWAY TICKET AND CERTIFICATE ISSU ED BY PATWARI. THE LEARNED ASSESSING OFFICER MADE INQUIRIES FROM T EHSILDAR U/S 133(6) WHO VIDE LETTER DATED 19.4.2011, CLAIMED TO HAVE INTIMATED THAT THE VILLAGE ARANDIA IS SITUATED AT A DISTANCE OF 4 TO 6 KMS FROM MR 11 ROUTE AND AT A DISTANCE OF 4 TO 5 KMS FR OM NIPANIA KHAJRANA KANKAD BY-PASS ROUTE. THE ASSESSEE WAS INF ORMED ABOUT THIS INFORMATION. THE ASSESSEE ATTENDED THE PROCEEDINGS AND MADE WRITTEN SUBMISSION THAT AN APPLICATION HAS BEEN MOVED TO PWD DEPARTMENT, CONSEQUENTLY A CERTIFICATE ISSUED BY PWD WAS PRODUCED BY THE ASSESSEE IN WHICH THE TOTAL DISTANCE OF THE LAND HAS BEEN MENTIONED AT MORE THAN 9 KMS FROM THE MUNICIPAL LIMIT. THE ASSESSING OFFICER MADE INQUIRI ES FROM PWD, INDORE AS PER WHICH VIDE LETTER DATED 29.11.2011 TH E SDO, PWD, SUB-DIVISION NO. 1, INTIMATED AS UNDER :- .....NEAREST DISTANCE BY ROAD FROM INDORE MUNICIP AL LIMIT (NIRANJANPUR) TO VILLAGE ARANDIA IS 7.8 K.M. SECON DLY, NEAREST DISTANCE BY ROAD FROM INDORE MUNICIPAL LIMI T (KHAJRANA AND NIPANIA) TO ARANDIA VILLAGE IS 9 KM. 5 THE LEARNED ASSESSING OFFICER WAS NOT SATISFIED WIT H THE EXPLANATION OF THE ASSESSEE AND FINALLY DISALLOWED THE CLAIMED CAPITAL GAIN OF RS.62,79,961/- BY TREATING THE SAME AS INCOME OF THE ASSESSEE. 3.1 ON APPEAL, THE LEARNED CIT(A) CONSIDERED THE FA CTS AND DOCUMENTS FILED BY THE ASSESSEE AND CONCLUDED AS UN DER :- 4.1 THE CRUX OF THE ISSUE INVOLVED IS AGITATED THROUGH GROUND NO. 1 & 2 AND OTHER GROUNDS ARE BROADLY CONSEQUENTIAL IN NATURE. THE ISSUE TO BE DECIDED IS WHETHER THE A.O.S ACTION IN DENYING THE CLAIM OF EXEMPTION OF CAPITAL GAIN ARISING ON SALE OF LAND SOLD IS JUSTIFIED IN FACTS AND CIRCUMSTANCES OF THE CASE OR NOT. FURTHER FOR DECIDING THIS ISSUE TWO ISSUES ARE TO BE EXAMINED FIRSTLY, WHETHER THE LAND SOLD CAN BE SAID TO BE AGRICULTURAL LAND OR NOT AND SECONDLY WHETHER THE SAME WAS SITUATED AT A DISTANCE OF MORE THAN 8 KMS FROM INDORE MUNICIPAL LIMIT OR NOT. 4.1.1 IN THE COURSE OF DISCUSSION IT WAS EMPHASISED BY THE AR PRESENT THAT FROM THE ORDER PASSED BY A.O. IT CLEARLY EMERGES THAT A.O. HAS PROCEEDED WITH THE SET MIND THAT SUCH SALE CONSIDERATION WAS TO BE BROUGHT TO TAX AS LONG TERM CAPITAL GAIN AND THUS HAS PROCEEDED TO REJECT ALL THE CERTIFICATES AND DOCUMENTS PRODUCED BY THE APPELLANT IN SUPPORT OF BOTH OF HIS CLAIMS THAT THE LAND WAS AGRICULTURAL LAND AND WAS SITUATED BEYOND 8 KMS FROM THE MUNICIPAL LIMIT. IT WAS EMPHASISED THAT THERE WAS ABSOLUTELY NO REASON ON RECORD TO REJECT THE CONTENTION THAT LAND WAS AGRICULTURAL IN NATURE EVEN WHEN TEHSILDAR HAS 6 STATED SO IN THE CERTIFICATE ISSUED AND OTHER EVIDENCES BEING P-1, P-2 AND P KHASRA CLEARLY SUPPORT THE APPELLANTS CLAIM THAT THE LAND WAS AGRICULTURAL IN NATURE. 4.1.2 PROCEEDING FURTHER TO THE OTHER ISSUE INVOLVED, IT WAS CONTENDED THAT THE A.O. HAD CHOSEN TO RELY ON VAGUE AND UNSPECIFIC CERTIFICATE ISSUED BY TAHSILDAR IN PLACE OF PROPER AND AUTHENTIC CERTIFICATE ISSUED BY PWD AUTHORITY IN THE MATTER OF MEASURING OF DISTANCE FROM OUTER LIMIT OF INDORE MUNICIPAL CORPORATION (IN SHORT IMC) TO THE LOCATION OF LAND. CONTINUING FURTHER, I T WAS STRESSED THAT THE DISTANCE HAS TO BE MEASURED UP TO THE ACTUAL LOCATION OF LAND SOLD AND NOT THE VILLAGE IN WHICH SUCH LAND WAS SITUATED AS VILLAGE MAY BE SPREAD OUT. FURTHER IT WAS CONTENDED THAT THE ROAD DISTANCE FROM THE LAND SOLD TO THE OUTER LIMIT OF INDORE MUNICIPAL CORPORATION HAS TO BE MEASURED UP ON THE BASIS OF ROAD NET WORK AVAILABLE ON THE DATE OF SALE AND NOT ON THE BASIS OF ROAD NET WORK WHICH CAME IN EXISTENCE LATER. IT WAS ALSO ARGUED THAT EXISTENCE OF ROAD NET WORK WAS A MAJOR FACTOR DETERMINING PRICE OF LAND AND HAD THE LATER NETWORK BEEN AVAILABLE EARLIER THE ASSESSEE/APPELLANT WOULD HAVE BEEN BENEFITTED BY GETTING ENHANCED RATE OF SALE CONSIDERATION WHICH WAS NOT REALISED AS THE LAND HAS TO BE SOLD ON THE BASIS OF THEN AVAILABLE ROAD NET WORK ONLY. 4.1.3 THE AR FINALLY SUMMED UP THAT AS PER CERTIFICATE ISSUED BY COMPETENT STATE GOVT. AUTHORITY IN THIS BEHALF I.E. PWD DEPTT. THE DISTANCE OF VILLAGE ARANDIYA, WHERE THE LAND WAS SITUATED BY SHORTEST ROUTE BY 7.8 KMS AND IF FURTHER DISTANCE OF 500 KMS FROM ROAD SPECIFICALLY MENTIONED IN PURCHASE DEED, EXECUTED IN THE YEAR 7 1996, IS TAKEN INTO CONSIDERATION THE LAND WAS CLEARLY SITUATED BEYOND 8 KMS WITHOUT ANY DOUBT FROM THE OUTER LIMIT OF INDORE MUNICIPAL CORPORATION, AR ALSO FILED COPY OF INSPECTORS REPORT AS REFERRED BY A.O. IN THE ASSESSMENT ORDER AND IT WAS CONTENDED THAT SUCH REPORT HAS TO BE ALTOGETHER IGNORED AS THE INSPECTOR HAS MEASURED THE DISTANCE FROM MR-11 ROUTE WHICH WAS STILL INCOMPLETE AND EVEN NOT IN EXISTENCE AT THE DATE OF SALE. IT WAS ALSO ARGUED THAT SUCH CERTIFICATE CANNOT BE ATTACHED ANY SIGNIFICANCE OR IMPORTANCE IN THE LIGHT OF VALID CERTIFICATE ISSUED BY PWD DEPARTMENT. IT WAS ALSO ARGUED THAT IF ONCE THE INSPECTOR WAS DEPUTED FOR INQUIRY THE DETAILS OF KHASRA NO. AND PARTICULARS OF THE LAND SOLD BEING AVAILABLE ON RECORD OF A.O., THE INSPECTOR SHOULD HAVE BEEN DIRECTED TO MEASURE THE DISTANCE UPTO THE LAND SOLD AND FROM THE INSPECTORS REPORT, IT I S NOT VERY CLEAR WHICH POINT IN ARANDIYA VILLAGE HAS BEEN CONSIDERED BY HIM FROM MEASURING SUCH DISTANCE. THUS IT WAS CONCLUDED THAT THE LAND BEING CLEARLY AGRICULTURAL AS PER STATE GOVT. RECOR D THE SAME COULD NOT HAVE BEEN OTHERWISE TREATING MERELY BECAUSE NO AGRICULTURAL INCOME WAS REFLECTED IN THE INCOME TAX RETURN FILED FOR WHICH THE APPELLANT HAS GIVEN VALID EXPLANATION AND THE LAND BEING SITUATED CLEARLY BEYOND 8 KMS THE A.O.S ACTION IN LEVYING LONG TERM CAPITAL GAIN ON SALE OF SUCH LAND AND TREATING THE SAME AS CAPITAL ASSET WITHIN THE MEANING OF SECTION 2(14) WAS IMPROPER BOTH IN FACTS AND IN LAW. 4.2 COMING TO THE FIRST ISSUE WHETHER THE LAND SOLD WAS AGRICULTURAL IN NATURE, THE ISSUE HAS TO BE NECESSARILY DECIDED IN FAVOUR OF THE APPELLANT. FIRSTLY, TAHSILDAR IN THE CERTIFICATE DATED 19.4.2011 DIRECTLY SENT TO THE A.O. WHICH HAS 8 BEEN RELIED BY HIM HAS CATEGORICALLY STATED THAT VARIOUS CROPS WERE TAKEN ON FOR THE YEAR 2005-06 TO 2010-11 AS DETAILED ATTACHED KHASRA. FURTHER P-2 KHASRA FROM THE YEAR 1994-95 ONWARDS AS FILED ON RECORD, CROP TAKEN IS CLEARLY STATED AS SOYABEAN AND MAIZE. EVEN THE PRESENT STATUS OF THE LAND SOLD IS AGRICULTURAL AS NOTED BY TEHSILDAR IN THE CERTIFICATE AND THE EVEN BY THE SUBSEQUENT OWNER OF THE LAND WHEREBY SUCH LAND IS BEING PUT TO AGRICULTURAL USE ONLY. SECONDLY, THE NATURE OF LAND SOLD IS CLEARLY STATED TO BE AGRICULTURAL LAND AS PER CITATION IN SALE DEED AND AGRICULTURAL OPERATIONS AT THE TIME OF SALE BEING CARRIED OUT AND ON THAT BASIS ONLY THE STAMP DUTY ON GUIDELINE RATE HAS BEEN CHARGED FOR THE PURPOSE OF REGISTRATION OF LAND. THUS THE A.O.S FINDINGS THAT THE LAND WAS NOT AGRICULTURAL IN NATURE MERELY BECAUSE NO AGRICULTURAL INCOME WAS DISCLOSED IN EARLIER YEARS RETURNS AS HELD IN PARA 6 OF THE ASSESSMENT ORDER IS AGAINST THE FACTS ON RECORD AND HENCE CANNOT BE ACCEPTED. 4.3 COMING TO THE SECOND ISSUE, WHETHER THE LAND SOLD WAS SITUATED AT A DISTANCE BEYOND 8 KMS FROM OUTER LIMIT OF INDORE MUNICIPAL CORPORATION, AGAIN THERE IS SUFFICIENT MERIT IN THE CONTENTIONS OF THE APPELLANT. THE AUTHENTIC CERTIFICATE ISSUED BY PWD AUTHORITY DATED 4.11.2011 WHICH WAS BEFORE A.O., THE DISTANCE BY SHORTEST ROUTE FROM OUTER LIMIT OF INDORE MUNICIPAL CORPORATION I.E. NIRANJANPUR TO VILLAGE ARANDIYA WAS 7./8 KMS AND THE DISTANCE THROUGH OTHER OUTER LIMIT OF MC I.E. KHAJRANA, THE DISTANCE WAS STILL MORE AT 9 KMS. THE CERTIFICATE DATED 19.04.2011 ISSUED BY TAHSILDAR AS ENCLOSED WITH APPEAL ORDER AS ANNEXURE-A CANNOT BE ATTACHED ANY SIGNIFICANCE IN THE MATTER OF DISTANCE FOR TWO 9 REASONS. FIRSTLY IT IS VAGUE AS THE DISTANCE IS STATED IN A WIDE RANGE OF 4 TO 6 KMS AND 4 TO 5 KMS FROM TWO DIFFERENT OUTER LIMIT AS NOTED ABOVE AND THAT TOO THROUGH MR-11 WHICH WAS NOT IN EXISTENCE ON THE DATE OF SALE OF LAND. SECONDLY, WHEN THE APPELLANT APPROACHED OFFICE OF THE TEHSILDAR, FOR CERTIFYING THE DISTANCE OF LAND HE WAS INFORMED BY LETTER DATED 18.11.2011, THAT SUCH INFORMATION WAS NOT AVAILABLE IN THEIR OFFICE. LETTERS AND APPLICATIONS FILED BY APPELLANT ARE COLLECTIVELY MARKED AS ANNEXURE B1 AND B2 ENCLOSED WITH APPEAL ORDER. FURTHER STILL EVEN IOMC WHEN APPROACHED BY THE APPELLANT INTIMATED THE APPELLANT PER LETTER DATED 2.12.2011 THAT THE DETAILS REGARDING DISTANCE OF VILLAGE ARANDIYA FROM ROAD NET WORK MAY BE OBTAINED FROM PWD AUTHORITY. THUS THE COMPETENT AUTHORITY IS STATE PWD DEPARTMENT ONLY IN THIS BEHALF. 4.3.1 PROCEEDINGS FURTHER, THE INSPECTORS REPORT INDICATING THE DISTANCE ALSO CANNOT BE ACCEPTED AS THE CORRECT MEASURE OF DISTANCE OF LAND SOLD ON THE DATE OF SALE, AS SUCH DISTANCE HAS BEEN MEASURED BY HIM THROUGH ROAD NET WORK WHICH WAS NOT IN EXISTENCE AND IN ANY MANNER CANNOT BE ATTACHED MORE SIGNIFICANCE AND IMPORTANCE FROM THE CERTIFICATE ISSUED BY STATE PWD DEPARTMENT WHO HAVE THE RELEVANT RECORDS AND ARE AUTHORISED IN THE MATTER. THUS ON THE BASIS OF ABOVE DISCUSSION THE DISTANCE OF VILLAGE ARANDIYA FROM OUTER LIMIT OF MUNICIPAL CORPORATION THROUGH SHORTEST ROUTE IS HELD TO BE 7.8 KMS. 4.3.2 FURTHER IT WAS CONTENDED BEFORE A.O. THAT THE LAND SOLD WAS SITUATED IN THE VILLAGE ARANDIYA AND THERE IS CLEAR MERIT IN THE CONTENTION OF THE APPELLANT THAT THE DISTANCE HAS TO BE MEASURED FROM THE OUTER LIMIT OF IMC TO THE ACTUAL 10 LOCATION OF LAND. THE DISTANCE OF LAND FROM THE ROAD IS CLEARLY STATED AT MORE THAN 500 METERS FROM THE ROAD IN THE SALE DEED EXECUTED IN THE YEAR 1996. IT IS STATED THAT THE DISTANCE OF THE AGRICULTURAL LAND SOLD FROM MAIN ROAD WAS MORE THAN HALF KMS. THUS IN THE FACTS OF THE APPELLANTS CASE ON THE BASIS OF EVIDENCE AVAILABLE ON RECORD, IT IS CONCLUSIVELY ESTABLISHED THAT THE LAND SOLD B Y THE APPELLANT WAS SITUATED FROM THE OUTER LIMIT OF IMC BY SHORTEST ROUTE AS PER ROAD NET WORK AVAILABLE ON THE DATE OF SALE AT 8.3 KMS (APPELLANT.) I.E. CLEARLY BEYOND 8 KMS AND ACCORDINGLY THE LAND WOULD NOT FALL IN THE DEFINITION OF CAPITAL ASSET WITHIN THE MEANING OF SECTION 2(14). HENCE THE SALE CONSIDERATION REALISED WAS EXEMPT FROM INCOME TAX AND A.O.S ACTION IN BRINGING TO TAX LONG TERM CAPITAL GAIN ON SALE OF SUCH AGRICULTURAL LAND IS NOT PERMISSIBLE I N LAW. ACCORDINGLY, GROUND NO. 1 AND 2 ARE ALLOWED IN FAVOUR OF APPELLANT. 3.2 IF THE OBSERVATION MADE IN THE ASSESSMENT ORDER , CONCLUSION DRAWN IN THE IMPUGNED ORDER, ASSERTION MADE BY THE LEARNED RESPECTIVE COUNSEL AND THE MATERIAL AVAILABLE ON RE CORD ARE KEPT IN JUXTAPOSITION AND ANALYSED, UNDER THE FACTS MENT IONED HEREINABOVE, WE FIND THAT THE LEARNED ASSESSING OFF ICER DISALLOWED THE CLAIMED EXEMPTION U/S 10(37) OF THE ACT MERELY ON THE GROUND FIRSTLY THAT THE IMPUGNED LAND IS SITUAT ED WITHIN THE PRESCRIBED LIMIT OF 8 KMS FROM THE MUNICIPALITY AND SECONDLY IT IS NOT AN AGRICULTURAL LAND AS IN EARLIER YEAR NO AGRI CULTURAL INCOME 11 WAS DISCLOSED BY THE ASSESSEE. IF THE OBSERVATION M ADE IN THE ASSESSMENT ORDER MORE SPECIFICALLY IN PARA 5.1, 5.3 AND THE REPLY OF THE ASSESSEE ARE EXAMINED, WE FIND THAT THE ASSE SSING OFFICER CONVENIENTLY IGNORED THE CERTIFICATE ISSUED BY PWD MENTIONING THAT THE IMPUGNED LAND IS SITUATED BEYOND THE PRESC RIBED LIMIT OF MUNICIPALITY BY SPECIFICALLY MENTIONING THAT THE LA ND IN QUESTION IS SITUATED BEYOND MORE THAN 9 KMS FROM MUNICIPAL L IMIT. THE INDORE BENCH OF THE TRIBUNAL HAS DEALT WITH THIS CA SE IN ASHOK SHUKLA (ITA NO. 207/IND/2012 ORDER DATED 31.8.2012) . WE ARE USEFULLY REPRODUCING THE SAID ORDER FOR READY REFER ENCE :- THE REVENUE IS AGGRIEVED BY THE IMPUGNED ORDER DA TED 31.1.2012 BROADLY ON THE GROUND THAT ON THE FACTS A ND IN THE CIRCUMSTANCES OF THE CASE, THE LEARNED FIRST APPELL ATE AUTHORITY ERRED IN TREATING THE LAND SOLD AS AGRICULTURAL LAN D WHEN THE ASSESSEE FAILED TO SUBSTANTIATE THAT ANY AGRICULTUR AL ACTIVITY WAS CARRIED OUT ON THE SAID LAND AND FURTHER ERRED IN HOLDING THAT THE LAND SOLD WAS BEYOND 8 KMS FROM THE MUNICI PAL LIMIT. 2. DURING HEARING, WE HAVE HEARD SHRI KESHAVE SAXEN A, LD. CIT/DR AND SHRI S.S. SHEETAL, LEARNED COUNSEL FOR T HE ASSESSEE. THE CRUX OF ARGUMENTS ON BEHALF OF THE RE VENUE IS IDENTICAL TO THE GROUND RAISED BY FURTHER SUBMITTIN G THAT FIRSTLY THE ASSESSEE HAS TO PROVE THAT ANY AGRICULTURAL OPE RATION WAS DONE BY THE ASSESSEE AS THE ASSESSEE HIMSELF IS NOT DOING ANY AGRICULTURAL OPERATION BEING ADVOCATE. IT WAS ALSO PLEADED THAT THE TEHSILDAR IS NOT A COMPETENT AUTHORITY TO ISSUE A CERTIFICATE REGARDING DISTANCE OF LAND FROM THE MUNICIPAL LIMIT . A PLEA WAS ALSO RAISED THAT THE LAND WAS SOLD TO DEVELOPER. OU R ATTENTION AS INVITED TO VARIOUS PAGES OF THE PAPER BOOK. RELI ANCE WAS PLACED ON THE DECISION IN 138 ITR 245 (GUJ), 136 IT R 621 (GUJ), 185 ITR 318 (KER.), 220 ITR 43 (SC) AND 176 ITR 523 (BOM). ON THE OTHER HAND, THE LEARNED COUNSEL FOR THE ASSESSE E DEFENDED THE IMPUGNED ORDER BY SUBMITTING THAT THE IMPUGNED LAND WAS INHERITED BY ALL THE BROTHERS AND WAS ALSO SOLD AS A COMPOSITE SALE BEING COMPOSITE LAND. IT WAS EXPLAINED THAT ON E OF THE 12 BROTHERS WAS CARRYING OUT AGRICULTURAL OPERATION AN D IT IS NOT NECESSARY THAT EVERY BROTHER WILL TILT THE LAND HIM SELF. A PLEA WAS ALSO RAISED THAT THE ASSESSING OFFICER AS WELL AS THE INSPECTOR OF THE INCOME TAX DEPARTMENT VISITED THE LAND, THE MAP WAS PREPARED BY THE INSPECTOR HIMSELF. THE LEA RNED COUNSEL TOOK US TO VARIOUS PAGES OF THE PAPER BOOK THROUGH WHICH HE TRIED TO EXPLAIN THAT THE LAND IN QUESTION IS SITUATED BEYOND 9 KMS FROM THE MUNICIPAL LIMIT. RELIANCE WA S ALSO PLACED UPON THE DECISION OF THE TRIBUNAL IN ITA NO. 506/IND/2010 ALONG WITH THE DECISION IN CIT VS. SMT . DEBBIE ALEMAO; 331 ITR 59 (BOM). 3. WE HAVE CONSIDERED THE RIVAL SUBMISSIONS AND PER USED THE MATERIAL AVAILABLE ON RECORD. THE FACTS, IN BRIEF, ARE THAT THE ASSESSEE IS AN ADVOCATE PRACTISING IN HIGH COURT OF MADHYA PRADESH AT INDORE. THE ASSESSEE EARNED INCOME FROM HOUSE PROPERTY, PENSION BEING EX-MLA IN STATE LEGISLATIVE ASSEMBLY, DECLARED INCOME OF RS. 4,04,690/- ON 5.9.2008. THE ASSESSEE CLAIMED EXEMPTION FROM CAPITAL GAINS ON SALE OF LAN D BY CLAIMING THE SAME TO BE AGRICULTURAL LAND SITUATED IN THE REVENUE RECORD OF VILLAGE LASUDIA PARMAR (TEH. SANV ER) BEARING KHASRA NO. 184, ETC. THE STAMP DUTY AND REGISTRATIO N FEES WERE BORNE BY THE PURCHASER AND THE SALE CONSIDERATION A MOUNTING TO RS.1,29,21,582/- WAS RECEIVED THROUGH CHEQUE. THE ASSESSING OFFICER CONCLUDED THAT THE IMPUGNED LAND IS SITUATE D WITHIN 8 KMS FROM THE MUNICIPAL LIMIT AND THEN MENTIONED THE PROVISIONS OF SECTION 10(37) OF THE IT ACT WHICH ARE APPLICABL E IN THE CASE OF COMPULSORY ACQUISITION, THEREFORE, IS NOT APPLIC ABLE TO THE FACTS OF THE CASE AS THE LAND WAS SOLD BY PRIVATE D EAL AND NO EXEMPTION U/S 54B OF THE ACT WAS CLAIMED. SO FAR AS THE ARGUMENT OF THE LEARNED CIT DR AND OBSERVATION OF T HE ASSESSING OFFICER THAT SINCE THE LAND WAS NOT CULTI VATED BY THE ASSESSEE HIMSELF AND WAS CARRIED ON BY THE BROTHER, THEREFORE, IT CANNOT BE TREATED AS AGRICULTURAL LAND. WE ARE N OT ABSOLUTELY CONVINCED BY THIS ARGUMENT/OBSERVATION BECAUSE THER E IS NO REQUIREMENT IN ANY ACT MORE ESPECIALLY THE INCOME T AX ACT THAT ONLY THE SELF CULTIVATED LAND WILL BE TREATED AS AG RICULTURAL LAND. THE TEHSILDAR IS THE CONCERNED REVENUE OFFICER WHO ON THE BASIS INFORMATION/REPORT OF REVENUE PATWARI ISSUES A CERT IFICATE. SINCE THE BROTHER OF THE ASSESSEE WAS DOING AGRICUL TURAL OPERATION, THEREFORE, ANY INCOME DERIVED OUT OF IT WILL BE TREATED AS AGRICULTURAL INCOME. EVEN IF LESS INCOME HAS BE EN SHOWN, THE ASSESSEE CANNOT BE DENIED THE CHARACTER OF AGRI CULTURAL INCOME. 4. SO FAR AS THE QUESTION OF DISTANCE FROM MUNICIPA L LIMIT IS CONCERNED, WE HAVE PERUSED THE RECORD AND FIND THAT EVEN AS PER THE REPORT OF THE INCOME TAX INSPECTOR (PAGES 9 AND 10 OF THE PAPER BOOK) IT HAS BEEN MENTIONED THAT THE LAND IS SITUATED 9.7 KMS BY ROAD FROM THE MUNICIPAL LIMIT BY A STRAI GHT DISTANCE 13 METHOD. THE MAP OF THE LAND (PAGE 10) WAS PREPARED BY THE INCOME TAX INSPECTOR HIMSELF, THEREFORE, DISREGARD TO SUCH DOCUMENT IS NOT JUSTIFIED. A CERTIFICATE HAS BEEN ISSUED BY THE EXECUTIVE ENGINEER, PUBLIC WORKS DEPARTMENT (PAGE 1 1 OF THE PAPER BOOK) WHEREIN IT HAS BEEN SPECIFICALLY MENTIO NED THAT THE IMPUGNED LAND IS 9.6 KMS FROM THE MUNICIPAL LIMIT. THE LAND REVENUE OFFICER (TEHSILDAR) HAD ALSO MENTIONED THE SURVEY NO. 95 AREA 4.22 ACRE, SURVEY NO. 96/1 AREA 1.20 ACRE A ND HAS MENTIONED THAT THE LAND IN QUESTION IS ABOUT 10 KMS FROM THE MUNICIPAL LIMIT AND THE POPULATION OF THE VILLAGE I S ABOUT 2000 PERSONS. THE ASSESSEE HAS ALSO PRODUCED A CERTIFI CATE FROM THE LAND SURVEYOR (PAGE 14) WHEREIN IT HAS BEEN MENTION ED THAT THE IMPUGNED LAND IS SITUATED AT 9.09 KMS FROM THE MUNI CIPAL LIMIT. THE ASSESSEE HAS ALSO PLACED ON RECORD THE GOOGLE M AP (PAGE 13). ALL THESE CERTIFICATES CLEARLY SAY THAT THE IM PUGNED LAND IS SITUATED BEYOND 9 KMS FROM THE MUNICIPAL LIMIT, THE REFORE, AS PER SECTION 2(14)(III) OF THE ACT, THE IMPUGNED AGR ICULTURAL LAND IS SITUATED IN THE REVENUE RECORD OF VILLAGE LASUDIA P ARMAR WHOSE POPULATION IS ABOUT 2000 PEOPLE WHICH IS LESS THAN THE CONDITION MENTIONED IN SECTION 2(14)(III)(A) OF THE ACT. SO FAR AS THE CONDITION MENTIONED IN SUB-CLAUSE (B) OF THE AF ORESAID SECTION IS CONCERNED, FROM RECORD IT IS CLEAR THAT THE IMPUGNED LAND IS BEYOND THE PRESCRIBED LIMIT OF 8 KMS FROM T HE MUNICIPAL LIMIT. FROM THIS ANGLE ALSO, THERE IS NO MISTAKE IN THE CONCLUSION DRAWN IN THE IMPUGNED ORDER. WE FURTHER FIND THAT SOME CASES LIKE LAUKIK DEVELOPERS; 303 ITR (AT) 356 HAVE BEEN RELIED UPON IN THE IMPUGNED ORDER/ASSESSMENT ORDER WHEREIN THE ISSUE WAS EXAMINED WITH RESPECT TO SECTION 80IB OF THE AC T WHEREAS THE ISSUE BEFORE US PERTAINS TO SECTION 2(14) WITH RESPECT TO AGRICULTURAL INCOME, THEREFORE, NOT APPLICABLE TO T HE FACTS OF THE PRESENT CASE. THE LEARNED CIT DR PLACED RELIANCE ON THE DECISIO N OF THE HONBLE GUJARAT HIGH COURT IN BALKRISHNA HARIBALLAB HADAS VS. CIT; 138 ITR 245. WE FIND THAT IN THAT CASE, THE L AND WAS SITUATED WITHIN MUNICIPAL LIMITS OF AHMEDABAD AND T HE SURROUNDING LAND WAS DEVELOPED AND SINCE THE LAND W AS NOT AGRICULTURAL LAND, THE GAINS FROM SALE OF SUCH LAND WAS HELD TO BE EXIGIBLE TO CAPITAL GAINS TAX. HOWEVER, THE LAN D IN QUESTION IS CLEARLY AGRICULTURAL LAND SITUATED BEYOND 9 KMS FROM THE MUNICIPAL LIMIT, THEREFORE, THIS CASE MAY NOT HELP THE REVENUE, MORESO ONE FACT PERTINENT TO MENTION HERE THAT PART OF THE SAME LAND, OWNED BY ONE OF THE BROTHERS, WAS TREATED AS AGRICULTURAL LAND, THEREFORE, IT IS QUITE UNJUSTIFIED TO TREAT P ART OF THE SAME LAND/CHUNK TO BE NON-AGRICULTURAL. ANOTHER CASE RE LIED UPON IS FROM HONBLE BOMBAY HIGH COURT IN FAZALBHOY INV. CO MPANY PVT. LTD.; 176 ITR 523 WHEREIN THERE WAS NO EVIDENC E SHOWING THAT NO AGRICULTURAL OPERATIONS WERE CARRIED OUT ON THE LAND. THE HONBLE COURT HELD THAT LAND WAS NOT AGRICULTUR AL. 14 HOWEVER, IN THE IMPUGNED LAND, AGRICULTURAL OPERATI ON WAS DONE BY ONE OF THE BROTHERS, THEREFORE, WITH UTMOST REGARD, THIS JUDICIAL PRONOUNCEMENT MAY NOT HELP THE REVENUE. AN OTHER DECISION RELIED ON IS CIT VS. GEMINI PICTURES CIRCU IT PRIVATE LIMITED; 220 ITR 43 (SC). THE LAND WAS SITUATED IN MOST IMPORTANT BUSINESS CENTRE OF A CITY AND WAS ENTERED IN THE MUNICIPAL RECORD AS URBAN LAND AND TAX WAS PAID THE REON. PART OF THE LAND WAS USED FOR CONSTRUCTION OF NON-RESIDE NTIAL BUILDING. IN THAT SITUATION, PROFIT ON SALE OF SUC H LAND WAS HELD TO BE EXIGIBLE TO CAPITAL GAINS. HOWEVER, IN THE IM PUGNED CASE, THE FACTS ARE ALTOGETHER DIFFERENT, THEREFORE, MAY NOT HELP THE REVENUE. A DECISION FROM HONBLE KERALA HIGH COURT IN KALPETTA ESTATES LTD. VS.CIT; 185 ITR 318 WAS RELIED UPON. IN THAT CASE, IT WAS HELD THAT BURDEN OF PROOF IS ON THE ASSESSEE TO PROVE THAT THE LAND WAS AGRICULTURAL LAND AT THE TIME OF TRANS FER AND FOREST LANDS WERE ACQUIRED WITH THE INTENTION OF EXTENDING PLANTATION. SINCE NO AGRICULTURAL OPERATION WAS CARRIED OUT, IT WAS HELD THAT IT GIVES RISE TO CAPITAL GAIN ON THE SALE OF SUCH L AND. IN THE CASE OF SARIFA BIBI MOHD. IBRAHIM; 136 ITR 621 (GUJ) THE LAND WAS SITUATED NEAR RAILWAY STATION AND WAS SOLD ON SQUAR E YARD BASIS TO HOUSING SOCIETY. THE PROFIT FROM THE SALE OF SUCH LAND WAS HELD TO BE ASSESSABLE TO CAPITAL GAINS TAX. KEE PING IN VIEW THE LOCATION AND OTHER ATTENDANT CIRCUMSTANCES, IT WAS HELD TO BE ASSESSABLE TO CAPITAL GAINS TAX. 5. THE LEARNED COUNSEL FOR THE ASSESSEE RELIED ON T HE DECISION OF THE HONBLE BOMBAY HIGH COURT IN CIT VS. SMT. D EBBIE ALENAO AND JOAQUIML ALENAO; (2011) 331 ITR 59 (BOM) WHEREIN THE LAND, IN QUESTION, WAS SHOWN IN THE REVENUE REC ORD AS AGRICULTURAL LAND AND NO PERMISSION WAS TAKEN FOR C ONVERSION OF LAND USE. IT WAS HELD THAT SINCE NO AGRICULTURAL I NCOME WAS SHOWN IN THE RETURN IS NOT THE MATERIAL FOR THE PUR POSES OF GAINS FROM SALE OF SUCH LAND. IT IS PERTINENT TO MENTION HERE THAT THIS CASE ALSO PERTAINS TO SECTION 45, 54, 54B, ETC. OF THE ACT. 6. IF THE TOTALITY OF FACTS AVAILABLE ON RECORD IS KEPT IN JUXTAPOSITION WITH THE JUDICIAL PRONOUNCEMENTS DISC USSED HEREINABOVE AND THE INTENTION OF THE LEGISLATURE AL ONG WITH RELEVANT SECTIONS, WE ARE OF THE CONSIDERED OPINION THAT A PARTICULAR LAND IS AGRICULTURAL LAND OR NOT DEPENDS UPON SO MANY FACTORS. ANY AGRICULTURAL INCOME DERIVED FROM AGRICULTURAL OPERATIONS WILL QUALIFY FOR AGRICULTURAL INCOME. S O FAR AS CAPITAL GAINS ON THE SALE OF SUCH LAND IS CONCERNED, IT ALS O DEPENDS UPON FACTORS LIKE LOCATION OF THE LAND, USE OF THE LAND, DISTANCE FROM MUNICIPAL LIMIT, WHETHER LAND USE WAS CHANGED, ETC. IF ALL THESE FACTORS ARE CUMULATIVELY KEPT IN MIND, ONE CL EAR FACT IS OOZING OUT THAT THE IMPUGNED LAND IS SITUATED BEYON D THE PRESCRIBED LIMIT FROM THE MUNICIPALITY, RECORDED AS AGRICULTURAL LAND IN THE REVENUE RECORD, AGRICULTURAL OPERATION WAS DONE BY ONE OF THE BROTHERS, WE ARE OF THE CONSIDERED OPINI ON THAT THE NO 15 CAPITAL GAINS TAX IS EXIGIBLE ON SALE OF SUCH LAND. SO FAR AS THE OBJECTION OF THE LEARNED CIT DR THAT THE TEHSILDAR IS NOT A COMPETENT AUTHORITY FOR MEASURING THE DISTANCE, WE ARE NOT SATISFIED WITH SUCH SUBMISSION ESPECIALLY WHEN THE INSPECTOR OF THE DEPARTMENT OF INCOME TAX AND TEHSILDAR BOTH HAV E CERTIFIED THAT THE LAND IS SITUATED BEYOND 8 KMS FROM THE MUN ICIPAL LIMIT. WE ARE OF THE CONSIDERED OPINION THAT TEHSILDAR IS THE MOST COMPETENT REVENUE OFFICER TO CERTIFY THE PROOF OF A GRICULTURAL OPERATION, DISTANCE OF LAND FROM A PARTICULAR PLACE , RATE OF LAND, ETC. OUR VIEW IS FURTHER FORTIFIED BY THE DECISION FROM HONBLE PUNJAB & HARYANA HIGH COURT IN CIT VS. LALSINGH & O THERS; 228 CTR 575. SO FAR AS THE ISSUE OF MEASURING THE LAND THROUGH STRAIGHT METHOD/AERIAL METHOD IS CONCERNED, WE ARE OF THE VIEW THAT FOR MEASURING THE LAND WE ARE SUPPOSE D TO GO BY THE ROAD, THEREFORE, ROAD DISTANCE IS THE MOST APPR OPRIATE METHOD AND NOT THE CROWS FLIES I.E. STRAIGHT LINE DISTANCE. THIS VIEW IS FURTHER SUPPORTED BY THE DECISION IN LAUKIK DEVELOPERS; 303 ITR 356 (MUM) AND THE DECISION FROM HONBLE PUN JAB & HARYANA HIGH COURT IN CIT VS. SATINDER PAL SINGH ( 2010) 229 CTR 82. THE HONBLE COURT HELD AS UNDER :- THE MAXIMUM DISTANCE PRESCRIBED BY SC. 2(14)(III) (B) WHICH MAY BE INCORPORATED IN THE NOTIFICATION COULD NOT B E MORE THAN 8 KMS FROM THE LOCAL LIMITS OF MUNICIPAL COMMITTEE OR CANTONMENT BOARD, ETC. THE NOTIFICATION HAS TO TAKE INTO ACCO UNT THE EXTENT OF AND SCOPE FOR URBANISATION OF THAT AREA AND OTHE R RELEVANT CONSIDERATIONS. THE RECKONING OF URBANISATION AS A FACTOR FOR PRESCRIBING THE DISTANCE IS OF SIGNIFICANCE WHICH W OULD YIELD TO THE PRINCIPLE OF MEASURING DISTANCE IN TERMS OF APP ROACH ROAD RATHER THAN BY STRAIGHT LINE ON HORIZONTAL PLANE. IF PRINCIPLE OF MEASUREMENT OF DISTANCE IS CONSIDERED STRAIGHT LINE DISTANCE ON HORIZONTAL PLANE OR AS PER CROWS FLIGHT THEN IT WO ULD HAVE NO RELATIONSHIP WITH THE STATUTORY REQUIREMENT OF KEEP ING IN VIEW THE EXTENT OF URBANISATION. SUCH A COURSE WOULD BE ILLUSORY. IT IS IN PURSUANCE OF THE AFORESAID PROVISION THAT NOT IFICATION NO. 9447 DT. 6 TH JAN., 1994 HAS BEEN ISSUED BY THE CENTRAL GOVERNMENT. IN RESPECT OF THE STATE OF PUNJAB, AT I TEM NO. 18 THE SUB-DIVISION KHANNA HAS BEEN LISTED AT SERIAL NO. 1 9. IT HAS INTER ALIA BEEN SPECIFIED THAT AREA UPTO 2 KMS FROM THE MUNICIPAL LIMITS IN ALL DIRECTIONS HAS TO BE REGARD ED OTHER THAN AGRICULTURAL LAND. ONCE THE STATUTORY GUIDANCE OF T AKING INTO ACCOUNT THE EXTENT AND SCOPE OF URBANISATION OF THE AREA HAS TO BE RECKONED WHILE ISSUING ANY SUCH NOTIFICATION THE N IT WOULD BE INCONGRUOUS TO THE ARGUMENT OF THE REVENUE THAT THE DISTANCE OF LAND SHOULD BE MEASURED BY THE METHOD O F STRAIGHT LINE ON HORIZONTAL PLANES OR AS PER CROWS FLIGHT B ECAUSE ANY MEASUREMENT BY CROWS FLIGHT IS BOUND TO IGNORE THE URBANISATION WHICH HAS TAKEN PLACE. TRIBUNAL WAS TH EREFORE JUSTIFIED IN HOLDING THAT DISTANCE OF 2 KMS FROM TH E MUNICIPAL 16 LIMITS OF CITY OF KHANNA HAS TO BE RECKONED FOR THE PURPOSES OF S. 2(14)(III) BY MEASURING THE SAME AS PER THE ROAD DISTANCE AND NOT AS PER STRAIGHT LINE DISTANCE ON A HORIZONTAL P LANE OR AS PER CROWS FLIGHT LAUKIK DEVELOPERS V. DY. CIT (2007) 108 TTJ (MUMBAI) 364 : (2007) 105 ITD 657 (MUMBAI) APPROVED . THE ABOVE CONCLUSION BY THE HONBLE HIGH COURT CLEA RLY SUPPORTS THE CASE OF THE ASSESSEE. IN THE CASE OF LALSINGH & OTHERS (SUPRA) THE HONBLE HIGH COURT CONCLUDED THA T THE REPORT OF THE TEHSILDAR HAVING CERTIFIED THAT THE A SSESSEES LAND WAS 8 KMS AWAY FROM THE MUNICIPAL LIMIT, THE LAND C ONSTITUTED AGRICULTURAL LAND ENTITLING THE ASSESSEE TO EXEMPTI ON U/S 54B OF THE ACT. 7. IF THE ASSESSMENT ORDER IS ANALYSED, WE ARE OF T HE VIEW THAT THE LEARNED ASSESSING OFFICER IS MORE GUIDED B Y SECTION 45 OF THE ACT WHICH SPEAKS ABOUT CAPITAL GAINS ARISING FROM THE TRANSFER OF CAPITAL ASSET. SECTION 54B OF THE ACT S PEAKS ABOUT NON-CHARGING OF GAINS OF THE CASES WHERE THERE IS A TRANSFER OF LAND USED FOR AGRICULTURAL PURPOSES. AN AMENDMENT WAS EFFECTED WITH EFFECT FROM 1.4.1970 SO AS TO INCLUDE LANDS SITUATED IN CERTAIN SPECIFIED AREAS WITHIN THE AMBI T OF NON- AGRICULTURAL LAND. HOWEVER, BURDEN IS ON THE ASSES SEE TO PROVE THAT THE LAND IS AGRICULTURAL LAND AND AT THE SAME TIME, ONUS IS ON THE DEPARTMENT TO PROVE THAT THE LAND IS NON-AGR ICULTURAL OR IT FORMS PART OF BUSINESS ASSET. FOR THE PURPOSES OF LAND BEING AGRICULTURAL LAND, ACTUAL AGRICULTURAL OPERATION OR CULTIVATION OR TILTING OF LAND IS ALWAYS NOT NECESSARY. WHAT IS T O BE SEEN IS WHETHER SUCH LAND IS CAPABLE OF AGRICULTURAL OPERAT ION BEING CARRIED ON. OUR VIEW IS FORTIFIED BY HONBLE CALCU TTA HIGH COURT BORHAT TEA COM. LTD.; 138 ITR 783. THE CORRECT TEST THAT HAS TO BE APPLIED IS WHETHER ON THE DATE OF SALE, THE LAND WAS AGRICULTURAL LAND OR NOT, WHETHER LAND USE WAS CHAN GED OR NOT. JUST BECAUSE AFTER THE SALE, THE PURCHASER WAS GOIN G TO PUT THE LAND TO NON-AGRICULTURAL USE, IT DOES NOT MEAN THAT ON THE DATE OF SALE THE LAND HAS CEASED TO BE AGRICULTURAL LAND . IF IN THE REVENUE RECORD, THE PARTICULAR LAND IS RECORDED AS AGRICULTURAL LAND AND TILL THE DATE OF SALE, IT IS EXPLOITED AS AGRICULTURAL LAND AND THE OWNER OF THE LAND HAS NOT TAKEN ANY STEP TO INDICATE HIS INTENTION TO EXPLOIT THE LAND FOR NON-AGRICULTU RAL PURPOSES THEN SUCH LAND TO BE REGARDED AS AGRICULTURAL LAND. THE PURPOSE FOR WHICH SUCH LAND IS SOLD IS NOT OF MUCH IMPORTANCE AND WEIGHT. IF THE DEPARTMENT IS IN A POSITION TO PROVE THAT IT WAS USED AS AGRICULTURAL LAND AS A STOP GAP ARRANGE MENT AND ITS LAND USE WAS CHANGED BEFORE THE SALE THEN THE S ITUATION MAY BE DIFFERENT. WHETHER THE LAND IS AN AGRICULTU RAL LAND OR NOT IS ESSENTIALLY A QUESTION OF FACT. A CLOSE REA DING OF SECTION 2(14)(III)(A) SEEMS TO SUGGEST THAT IT IS THE POPUL ATION OF THE MUNICIPALITY THAT HAS TO BE TAKEN INTO ACCOUNT AND NOT THE POPULATION OF ANY AREA WITHIN THE MUNICIPALITY. IT MAY BE THAT A 17 MUNICIPALITY MAY COMPRISE OF MANY VILLAGES, WARDS A ND STREET AND EACH ASSESSEE MAY CLAIM THAT THE LIMIT OF POPUL ATION IS PROVIDED WITH REFERENCE TO A PLACE, WARD OR STREET. IN SUCH AN EVENT, THE SECTION WILL HAVE NO UNIFORM APPLICATION AND WILL LEAD TO MANY ANOMALIES. PANCHAYAT IS DIFFERENT FROM MUNI CIPALITY. MUNICIPALITY IS ALWAYS UNDERSTOOD DIFFERENTLY FROM PANCHAYAT, THEREFORE, THE LAND SITUATED BEYOND PRESCRIBED MUNI CIPAL LIMIT AND IS RECORDED AS AGRICULTURAL LAND IN THE REVENUE RECORD IS TO BE CONSIDERED AS AGRICULTURAL LAND UNTIL PROVED OTH ERWISE. ADMITTEDLY, THE TERM CAPITAL ASSET HAS AN ALL EMB RACING CONNOTATION AND INCLUDES EVERY KIND OF PROPERTY AS GENERALLY UNDERSTOOD EXCEPT THOSE ARE EXPRESSLY EXCLUDED FROM THE DEFINITION. IT IS EXACTLY THE CASE HERE BECAUSE SE CTION 2(14)(III) EXPRESSLY DEFINES AGRICULTURAL LAND WITH REGARD TO ITS LOCATION AND DISTANCE FROM THE MUNICIPAL LIMIT. IT SEEMS THA T THE LEARNED ASSESSING OFFICER HAS NOT EXAMINED THE DOCUMENTS PR ODUCED BY THE ASSESSEE ESTABLISHING THE DISTANCE OF LAND BEYO ND PRESCRIBED MUNICIPAL LIMIT AND MORE SPECIFICALLY WH EN KHASRA NUMBER, ETC. HAS BEEN DULY MENTIONED IN THE REPORT OF TEHSILDAR. SO FAR AS THE ARGUMENT OF THE LEARNED CI T DR THAT THE LAND WAS SOLD AT A SUBSTANTIAL AMOUNT IS NOT THE RE LEVANT FACTOR TO PROVE THAT IT WAS NON-AGRICULTURAL LAND BECAUSE IT DEPENDS UPON SO MANY FACTORS. EVEN IN THE GROUNDS OF APPEAL , THE REVENUE HAS RAISED A GROUND THAT THE DOCUMENTARY EV IDENCES PRODUCED BY THE ASSESSEE BELONG TO THE LAND OF SHRI RAKESH SHUKLA, BROTHER OF THE ASSESSEE. WE ARE NOT CONVINC ED WITH THIS ARGUMENT ALSO BECAUSE THE TOTAL LAND IS ADJOINING T O EACH OTHER AND IS FROM ONE CHUNK. THIS CLAIM OF THE REVENUE RA THER SUPPORTS THE CASE OF THE ASSESSEE. AS MENTIONED EAR LIER, IN THE CASE OF ONE OF THE BROTHERS, IT HAS BEEN ALLOWED AS AGRICULTURAL LAND, THEREFORE, NO DIFFERENT YARD STICK CAN BE ADO PTED IN THE CASE OF ANOTHER BROTHER, BEING THE LAND IS PART OF THE SAME CHUNK. THE TOTALITY OF FACTS CLEARLY LEADS TO THE C ONCLUSION, UNDER THE FACTS NARRATED HEREINABOVE, THAT THE IMPU GNED LAND IS AGRICULTURAL LAND, THEREFORE, THE STAND OF THE L EARNED CIT(A) IS AFFIRMED. FINALLY, THE APPEAL OF THE REVENUE IS HAVING NOT M ERIT, THEREFORE, DISMISSED. ORDER WAS PRONOUNCED IN THE OPEN COURT ON 31.8.20 12. 3.3 IN THE AFORESAID ORDER THE CONTENTION OF THE LEARNED SENIOR DR THAT THE TEHSILDAR IS NOT A COMPETENT AUT HORITY HAS BEEN DEALT WITH ALONG WITH VARIOUS JUDICIAL PRONOUN CEMENTS LIKE LALSINGH & OTHERS; 228 CTR 575 (P&H), LAUKIK DEVELO PERS; 303 18 ITR 356 (MUM); CIT VS. SATINDER PAL SINGH (201) 229 CTR 82 (P&H), ETC. ALONG WITH SMT. DEVVIE ALENAO & JOAQUIM L ALENAO (2011) 331 ITR 59 (BOM), KALPETTA ESTATES LTD. VS. CIT; 185 ITR 318 (KER.), SHARIFA BEEVI MOHD. IBRAHIM; 136 ITR 62 1 (GUJ.); BAL KRISHNA HARI VALLABHDAS; 138 ITR 245, ETC. THE ASSE SSEE IN THE PRESENT APPEAL ALSO PRODUCED THE REVENUE KHASRA PAA NCHSHALA ISSUED BY THE OFFICE OF TEHSILDAR EVIDENCING THAT D URING THE RELEVANT PERIOD THE ASSESSEE GREW VARIOUS CROPS FRO M THE IMPUGNED LAND. A RIN PUSTIKA, IN THE NAME OF THE A SSESSEE, BEARING NO. 3719 WAS ALSO KEPT ON RECORD. THE ASSES SEE HAS ALSO FILED AN AFFIDAVIT IN WHICH IT HAS BEEN SWORN THAT THE LAND IN QUESTION WAS PURCHASED IN THE YEAR 1996-97 AND WAS SOLD AS PER THE SALE DEED. IT HAS BEEN FURTHER MENTIONED THAT THE LAND IS SITUATED APPROXIMATELY 9 KMS FROM THE MUNICIPAL LIM IT AND IN PARA 3 VARIOUS CROPS, VEGETABLES WERE GROWN AS MENT IONED BY HALKA PATWARI, THEREFORE, THE CONTENTION OF THE ASS ESSING OFFICER THAT NO CROP WAS GROWN IS NOT SUBSTANTIATED. SO FA R AS THE CONTENTION OF THE LEARNED SENIOR DR THAT MR 10 WAS WRONGLY MENTIONED, THE LEARNED COUNSEL FOR THE ASSESSEE PRO DUCED A CERTIFICATE/WORK ORDER IN THE NAME OF M/S LAKRAS BU ILDERS DATED 16.9.2010 AS PER WHICH THE WORK IS TO BE COMPLETED WITHIN 10 19 MONTHS FROM THE ISSUE OF THIS LETTER MEANING THEREB Y AT THE TIME OF PURCHASE/SALE OF THE LAND, THIS MR 10 WAS NOT IN EXISTENCE, THEREFORE, THE CONTENTION OF THE LEARNED ASSESSING OFFICER WHICH WAS ASSERTED BY THE LEARNED SR. DR IS NOT SUBSTANTI ATED. SO FAR AS THE DISTANCE OF THE LAND IS CONCERNED, THE PWD A S WELL AS THE TEHSILDAR BOTH HAVE CERTIFIED THROUGH THEIR RESPECT IVE CERTIFICATES THAT THE IMPUGNED LAND IS SITUATED BEYOND 8 KMS FRO M THE MUNICIPAL LIMIT. SO FAR AS THE DECISION IN THE CAS E OF SHARIFA BIBI MOHD. IBRAHIM AND OTHERS (SUPRA) IS CONCERNED, WHER E IT HAS BEEN HELD THAT WHETHER A PIECE OF LAND IS AGRICULTU RAL LAND OR NOT IS ESSENTIALLY A QUESTION OF FACT. SEVERAL TESTS HA VE BEEN EVOLVED IN THE DECISIONS OF THE HONBLE APEX COURT AND HON BLE HIGH COURT BUT ALL OF THEM ARE MORE IN THE NATURE OF GUI DELINES. THE QUESTION HAS TO BE ANSWERED IN EACH CASE HAVING PEC ULIAR FACTS OF THOSE CASES. IN THE PRESENT APPEAL, THE REVENUE REC ORD ISSUED BY TEHSILDAR, IN OUR VIEW, IS MORE AUTHENTIC DOCUMENT IN WHICH IT HAS BEEN CLEARLY MENTIONED THAT VARIOUS CROPS WERE GROWN BY THE ASSESSEE WHICH IS FURTHER SUPPORTED BY AN AFFIDAVIT OF THE ASSESSEE WHICH HAS NOT BEEN FOUND UNTRUE. NO EVIDE NCE HAS BEEN BROUGHT ON RECORD BY THE ASSESSING OFFICER EVI DENCING THAT NO CROPS WERE GROWN BY THE ASSESSEE. IF ANY SUSPICI ON CREPT INTO 20 THE MIND OF THE ASSESSING OFFICER, NOTHING PREVENTE D HIM TO GET THE REPORT FROM SARPANCH, NEIBOURS OF THE IMPUGNED LAND OR THE REVENUE PATWARI BUT THAT WAS NOT DONE BY HIM. THE C ONCLUSION DRAWN IN THE IMPUGNED ORDER CLEARLY INDICATES THAT THE IMPUGNED LAND IS SITUATED CLEARLY BEYOND 8 KMS FROM THE MUNI CIPALITY. IN VIEW OF THESE FACTS, THE LAND WOULD NOT FALL WITHIN THE DEFINITION OF CAPITAL ASSET AS MENTIONED IN SEC. 2(14) OF THE ACT , THEREFORE, WE FIND NO INFIRMITY IN THE CONCLUSION DRAWN IN THE IM PUGNED ORDER. IT IS AFFIRMED. FINALLY, THE APPEAL OF THE REVENUE IS HAVING NO ME RIT, CONSEQUENTLY, DISMISSED. THIS ORDER WAS PRONOUNCED IN THE OPEN COURT IN THE PRESENCE OF LD. REPRESENTATIVES FROM BOTH SIDES AT THE CONCLUSION OF THE HEARING ON 3.9.2013. SD SD (R.C.SHARMA) (JOGINDER SINGH ) ACCOUNTANT MEMBER JUDICIAL ME MBER DATED: 21.10.2013 COPY TO: APPELLANT, RESPONDENT, CIT, CIT(A), DR, GU ARD FILE !VYAS!