Sanjeev Kumar Goyal , Kolkata V. ITO, Ward - 45(2), Kolkata , Kolkata

ITA 981/KOL/2018

• Counselvise Citation: [2019] 112 COUNSELVISE.COM (IT) 3491 (ITAT-KOLKATA)
• Duration Of Justice: 1 year(s) 6 month(s) 18 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 29-11-2019
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: B
• Assessment Year: 2011-2012
• Appeal Filed On: 11-05-2018
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: RANU BISWAS
• Assessee Lawyers: A K TIBREWAL
• Keywords: Sale consideration of property below Jantri Value; Capital asset; Business income; Rule of consistency; Capital Gains
• Section: 143(3); 50C; 54F; 2(14); 133(6); 250; 251; 191; 63

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL KOLKATA B BENCH, KOLKATA [BEFORE SHRI J. SUDHAKAR REDDY, HONBLE ACCOUNTANT MEMBER & SHRI S.S. GODARA, HONBLE JUDICIAL MEMBER] I.T.A. NO. 981/KOL/2018 ASSESSMENT YEAR: 2011-12 SANJEEV KUMAR GOYAL...........................................APPELLANT 45-B, ADHYA SRADHA GHAT ROAD KOLKATA 700 007 [PAN: ADPPG 5953 N] VS. INCOME TAX OFFICER, WARD-45(2), KOLKATA.....................................................RESPONDENT APPEARANCES BY: SHRI A.K. TIBREWAL, FCA, APPEARED ON BEHALF OF THE ASSESSEE. SMT. RANU BISWAS, ADDL. CIT, D/R, APPEARING ON BEHALF OF THE REVENUE DATE OF CONCLUDING THE HEARING : SEPTEMBER 16 TH , 2019 DATE OF PRONOUNCING THE ORDER : NOVEMBER 29 TH , 2019 O R D E R PER J. SUDHAKAR REDDY, AM :- THIS APPEAL FILED BY THE ASSESSEE IS DIRECTED AGAINST THE ORDER OF THE LEARNED COMMISSIONER OF INCOME TAX (APPEALS) 13, KOLKATA, (HEREINAFTER THE LD.CIT(A)), PASSED U/S. 250 OF THE INCOME TAX ACT, 1961 (THE ACT), DT. 15/01/2018, FOR THE ASSESSMENT YEAR 2011-12. 2. THE ASSESSEE IS AN INDIVIDUAL. HE FILED HIS RETURN FOR THE ASSESSMENT YEAR 2011-12 ON 07/02/2019, DECLARING TOTAL INCOME OF RS.4,72,220/-. THE ASSESSING OFFICER, DURING THE COURSE OF HEARING, FOUND THAT AS PER THE AIR INFORMATION AVAILABLE WITH THE ADDITIONAL DISTRICT SUB-REGISTRAR (ADSR), HARIPAL, P.O. KHAMARCHANDI, HOOGHLY, W.B. 712405, THE ASSESSEE, IN HIS CAPACITY, AS THE PARTNER OF THE FIRM M/S. SHREE ANNAPURNA OIL MILLS OF 56, KALI KRISHNA TAGORE STREET, KOLKATA, ENTERED INTO TWO SALE AGREEMENTS OF CAPITAL ASSETS BEING LAND AND BUILDING WITH M/S STP LTD. OF 6, LYONS RANGE, KOLKATA FOR CONSIDERATION OF RS.2,32,55,910/- AND RS.56,70,924/-. A REQUISITION U/S 133(6) OF THE ACT, WAS SENT TO THE ADSR AND COPY OF DOCUMENTS/SALE DEED OF THE LAND WAS OBTAINED. 2.1. THE ASSESSING OFFICER AT PARA 5 OF HIS ORDER STATES AS FOLLOWS:- 2 I.T.A. NO. 981/KOL/2018 ASSESSMENT YEAR: 2011-12 SANJEEV KUMAR GOYAL 3 I.T.A. NO. 981/KOL/2018 ASSESSMENT YEAR: 2011-12 SANJEEV KUMAR GOYAL 2.2. IN REPLY, TO A SHOWCAUSE NOTICE DT. 14/02/2014, AS TO WHY THE INCOME FROM SALE OF LAND SHOULD NOT BE ADDED TO THE TOTAL INCOME OF THE ASSESSEE, THE LD. COUNSEL FOR THE ASSESSEE, SUBMITTED AS FOLLOWS: A) THE PARTNERSHIP FIRM M/S. SHREE ANNAPURNA OIL MILLS, WA BETWEEN THE ASSESSEES FATHER AND B) THE ASSESSEE CONTRIBUTED TO THE FIRM A SUM OF RS.10 LAKHS/ C) THE PARTNERSHIP FIRM HAD PURCHASED AGRICULTURAL LANDS IN THE YEAR 2005 FOR A CONSIDERATION OF RS.20,00,000/ D) THE LAND WAS PURCHASED BY THE FIRM AS AN INVESTMENT AND THERE WAS NO INCOME OF THE SAID FIRM AS THERE WAS NO BUSINESS UNDERTAKEN BY THE FIRM IN ANY OF THE YEAR EXCEPT TH A DEPARTMENTAL INSPECTOR WAS DEPUTED TO MAKE ENQUIRIES ABOUT THE N AND TYPE OF LAND WHICH WAS SOLD. ON 05/03/2014. THE RELEVANT PORTION OF THE REPORT IS EXTRACTED FOR READY REFERENCE:- REQUISITION U/S 133(6) WAS SENT TO THE ADSR, HARIPAL AND THE COPY OF THE DEEDS WERE OBTAINED. THEREAFTER, I VISITED THE 010 THE BUILDING, LAND & REVENUE OFFICER AT HARIPAL, HOOGHLY ON 28.02.2014, WHICH IS ABOUT 52 KM AWAY FORM KOLKATA, TO ENQUIRE ABOUT THE NATURE, LOCATION & TYPE OF THE LAND WHICH IS SOLD. I MET SMT. INDRANI CHATTERJEE, CONFIRMED THAT THE SAID LAND SOLD IN TWO SEPARATE DEEDS, IS OF 3 TYPES I.E. SALI (LESS FERTILE LAND), VITI (LAND IS USED FOR THE PURPOSE OF CONSTRUCTION OF PUCCA STRUCTURE) AND DOBA (WATER BODIES). SHE FURTHER CONFIRMED THAT THE LAN SITUATED IN MOUZA- SIPAIGACHI AND THE PROXIMITY OF NATIONAL HIGHWAY NO.2 HAD CAUSED IN RAPID INDUSTRIALIZATION. THE LAND IN QUESTION IS ALSO CONVERTED INTO INDUSTRIAL LAND BY THE PURCHASER I.E. M/S STP LTD. SHE STATED THAT SHE WAS NOT AWARE OF ANY PAST AG AND WENT TO THE LAND AS SPECIFIED IN THE DEED. THE LAND IS SITUATED BY THE SIDE OF HARIPAL-SIYAKHALA- NH2 ROAD WHICH IS ALSO BUS ROUTE. CONCRETE STRUCTURES AND IRON SHADES ARE CONSTRUCTED UPON IT WITH A GA COMPANY. I TOOK FEW PICTURES OF THE LAND AND RETURNED TO KOLKATA. 2.2.1. THE ASSESSING OFFICER CONCLUDED THAT THE LAND IN QUESTION IS AGRICULTURAL LAND. HE ALSO TOOK SUPPORT FROM THE SALE DEED NUMBERS 4482/10 AND 4483/10 WHER E AT PAGE 19, IT IS STATED AS FOLLOWS: TOTAL TRANSFERRED IN NINE L.R. DAGS MEASURING 425 (FOUR HUNDRED TWENTY FIVE) SATAK (MORE OR LESS) WHICH DELINEATED WITH RED LINE BORDER IN THE ANNEXED PLAN WITH A BUILDING AREA MEASURING 5098 SQ.FT RIGHTS OF PATH AND PASSAGE ALONGWITH WITH EASEMENT RIGHT TO OBTAIN 4 IN REPLY, TO A SHOWCAUSE NOTICE DT. 14/02/2014, AS TO WHY THE INCOME FROM SHOULD NOT BE ADDED TO THE TOTAL INCOME OF THE ASSESSEE, THE LD. COUNSEL FOR THE ASSESSEE, SUBMITTED AS FOLLOWS: - THE PARTNERSHIP FIRM M/S. SHREE ANNAPURNA OIL MILLS, WA S CONSTITUTED THE ASSESSEES FATHER AND HIS TWO BROTHERS. THE ASSESSEE CONTRIBUTED TO THE FIRM A SUM OF RS.10 LAKHS/ - THE PARTNERSHIP FIRM HAD PURCHASED AGRICULTURAL LANDS IN THE YEAR 2005 FOR A CONSIDERATION OF RS.20,00,000/ -. PURCHASED BY THE FIRM AS AN INVESTMENT AND THERE WAS NO INCOME OF THE SAID FIRM AS THERE WAS NO BUSINESS UNDERTAKEN BY THE FIRM IN ANY OF THE YEAR EXCEPT TH E PURCHASE AND SALE OF THIS LAND. A DEPARTMENTAL INSPECTOR WAS DEPUTED TO MAKE ENQUIRIES ABOUT THE N AND TYPE OF LAND WHICH WAS SOLD. THE DEPARTMENTAL INSPECTOR SUBMITTED HIS REPORT ON 05/03/2014. THE RELEVANT PORTION OF THE REPORT IS EXTRACTED FOR READY REQUISITION U/S 133(6) WAS SENT TO THE ADSR, HARIPAL AND THE COPY OF THE OBTAINED. THEREAFTER, I VISITED THE 010 THE BUILDING, LAND & REVENUE OFFICER AT HARIPAL, HOOGHLY ON 28.02.2014, WHICH IS ABOUT 52 KM AWAY FORM KOLKATA, TO ENQUIRE ABOUT THE NATURE, LOCATION & TYPE OF THE LAND WHICH IS SOLD. I MET SMT. INDRANI CHATTERJEE, REVENUE OFFICER AND SHE CONFIRMED THAT THE SAID LAND SOLD IN TWO SEPARATE DEEDS, IS OF 3 TYPES I.E. SALI (LESS FERTILE LAND), VITI (LAND IS USED FOR THE PURPOSE OF CONSTRUCTION OF PUCCA STRUCTURE) AND DOBA (WATER BODIES). SHE FURTHER CONFIRMED THAT THE LAN SIPAIGACHI AND THE PROXIMITY OF NATIONAL HIGHWAY NO.2 HAD CAUSED IN RAPID INDUSTRIALIZATION. THE LAND IN QUESTION IS ALSO CONVERTED INTO INDUSTRIAL LAND BY THE PURCHASER I.E. M/S STP LTD. SHE STATED THAT SHE WAS NOT AWARE OF ANY PAST AG RICULTURAL ACTIVITY ON THE SAID LAND. I THANKED HER AND WENT TO THE LAND AS SPECIFIED IN THE DEED. THE LAND IS SITUATED BY THE SIDE NH2 ROAD WHICH IS ALSO BUS ROUTE. CONCRETE STRUCTURES AND IRON SHADES ARE CONSTRUCTED UPON IT WITH A GA TE DISPLAYING THE NAME OF COMPANY. I TOOK FEW PICTURES OF THE LAND AND RETURNED TO KOLKATA. THE ASSESSING OFFICER CONCLUDED THAT THE LAND IN QUESTION IS LAND. HE ALSO TOOK SUPPORT FROM THE SALE DEED NUMBERS 4482/10 AND E AT PAGE 19, IT IS STATED AS FOLLOWS: - TOTAL TRANSFERRED IN NINE L.R. DAGS MEASURING 425 (FOUR HUNDRED TWENTY SATAK (MORE OR LESS) WHICH DELINEATED WITH RED LINE BORDER IN THE ANNEXED PLAN WITH A BUILDING AREA MEASURING 5098 SQ.FT . WITH EASEMENT RIGHTS OF PATH AND PASSAGE ALONGWITH WITH EASEMENT RIGHT TO OBTAIN I.T.A. NO. 981/KOL/2018 ASSESSMENT YEAR: 2011-12 SANJEEV KUMAR GOYAL IN REPLY, TO A SHOWCAUSE NOTICE DT. 14/02/2014, AS TO WHY THE INCOME FROM SHOULD NOT BE ADDED TO THE TOTAL INCOME OF THE ASSESSEE, THE LD. COUNSEL S CONSTITUTED THE PARTNERSHIP FIRM HAD PURCHASED AGRICULTURAL LANDS IN THE YEAR 2005 -06, PURCHASED BY THE FIRM AS AN INVESTMENT AND THERE WAS NO INCOME OF THE SAID FIRM AS THERE WAS NO BUSINESS UNDERTAKEN BY THE FIRM IN A DEPARTMENTAL INSPECTOR WAS DEPUTED TO MAKE ENQUIRIES ABOUT THE N ATURE THE DEPARTMENTAL INSPECTOR SUBMITTED HIS REPORT ON 05/03/2014. THE RELEVANT PORTION OF THE REPORT IS EXTRACTED FOR READY REQUISITION U/S 133(6) WAS SENT TO THE ADSR, HARIPAL AND THE COPY OF THE OBTAINED. THEREAFTER, I VISITED THE 010 THE BUILDING, LAND & REVENUE OFFICER AT HARIPAL, HOOGHLY ON 28.02.2014, WHICH IS ABOUT 52 KM AWAY FORM KOLKATA, TO ENQUIRE ABOUT THE NATURE, LOCATION & TYPE OF THE LAND REVENUE OFFICER AND SHE CONFIRMED THAT THE SAID LAND SOLD IN TWO SEPARATE DEEDS, IS OF 3 TYPES I.E. SALI (LESS FERTILE LAND), VITI (LAND IS USED FOR THE PURPOSE OF CONSTRUCTION OF PUCCA STRUCTURE) AND DOBA (WATER BODIES). SHE FURTHER CONFIRMED THAT THE LAN D SIPAIGACHI AND THE PROXIMITY OF NATIONAL HIGHWAY NO.2 HAD CAUSED IN RAPID INDUSTRIALIZATION. THE LAND IN QUESTION IS ALSO CONVERTED INTO INDUSTRIAL LAND BY THE PURCHASER I.E. M/S STP LTD. SHE STATED THAT SHE WAS RICULTURAL ACTIVITY ON THE SAID LAND. I THANKED HER AND WENT TO THE LAND AS SPECIFIED IN THE DEED. THE LAND IS SITUATED BY THE SIDE NH2 ROAD WHICH IS ALSO BUS ROUTE. CONCRETE STRUCTURES TE DISPLAYING THE NAME OF THE ASSESSING OFFICER CONCLUDED THAT THE LAND IN QUESTION IS NON- LAND. HE ALSO TOOK SUPPORT FROM THE SALE DEED NUMBERS 4482/10 AND TOTAL TRANSFERRED IN NINE L.R. DAGS MEASURING 425 (FOUR HUNDRED TWENTY SATAK (MORE OR LESS) WHICH DELINEATED WITH RED LINE BORDER IN THE . WITH EASEMENT RIGHTS OF PATH AND PASSAGE ALONGWITH WITH EASEMENT RIGHT TO OBTAIN ELECTRICITY LINE, WATER LINE, TELEPHONE LINE, GAS LINE ETC. ON PATH AND PASSAGES. IN REPLY TO A FURTHER SHOWCAUSE NOTICE DT. 07/03/2014, THE ASSESSEE SUBMITTED AS FOLLOWS:- A) THE AGRICULTURAL LANDS WERE PURCHASED BY THE PARTNERSHIP FIRMS AS INVESTMENT AND THIS PARTNERSHIP FIRM HAD NEVER APPLIED FOR A PERMANENT ACCOUNT NO. (PAN). BOOKS OF ACCOUNTS AND FURTHER DOCUMENTS WERE PRODUCED. B) THE SAID LAND WAS USED FOR AGRICULTURAL PURPOSES BY ONE, SHRI SATISH MURMU, WHO WAS RECORDED AS MURMU, CARRIED OUT AGRICULTURAL OPERATIONS IN CONSIDERATION OF UNDERTAKING THAT HE WOULD LOOK AFTER THE LANDS F A COPY OF THE CERTIFICATE DT. 26/08/2010 ISSUED BY PANTRA GRAM PANCHAYAT, WAS FURNISHED. C) THE ASSESSING OFFICER CONCLUDED THAT THE SUBMISSIONS OF THE ASSESSEE WAS SELF- CONTRADICTORY FOR THE REASON THAT, IT WAS ST PURCHASED AS INVESTMENT AND ON THE OTHER HAND IT WAS CLAIMED THAT CERTAIN PERSON IS CARRYING OUT AGRICULTURAL ACTIVITIES FOR AND ON BEHALF OF THE PARTNERSHIP FIRM. THEREAFTER, THE ASSESSING OFFICER HELD THAT THE LAND IN QUESTION IS NOT AGRICULTURAL LAND, BY APPLYING THE FEW TESTS LAID DOWN BY THE HONBLE COURTS FOR DETERMINING WHETHER A LAND IS AGRICULTURAL OR NOT. THE TESTS APPLIED ARE AS UNDER: I. WHETHER THE LAND WAS AGRICULTURAL PURPOSES II. WHETHER THE LAND, THOUGH ENTERED IN THE REVENUE RECORDS, HAD NEVER BEEN ACTUALLY USED FOR AGRICULTURE; WHETHER THE OWNER MEAN OR INTENDED TO USE IT FOR AGRICULTURAL PURPOSES; III. WHETHER THE INCOME DERIVED FROM THE AGRICULTURAL O BEAR ANY RATIONAL PROPORTION TO THE INVESTMENT MADE IN PURCHASING THE LAND 2.3. HE HELD THAT THE LAND WAS IRRECOVERABLY CONVERTED INTO INDUSTRIAL LAND AND THAT THE INTENTIONS OF THE OWNERS WAS DEFINITELY NOT TO PROMOTE AGRICULTURAL 5 ELECTRICITY LINE, WATER LINE, TELEPHONE LINE, GAS LINE ETC. ON PATH AND IN REPLY TO A FURTHER SHOWCAUSE NOTICE DT. 07/03/2014, THE ASSESSEE THE AGRICULTURAL LANDS WERE PURCHASED BY THE PARTNERSHIP FIRMS AS INVESTMENT AND THIS PARTNERSHIP FIRM HAD NEVER APPLIED FOR A PERMANENT ACCOUNT NO. (PAN). BOOKS OF ACCOUNTS AND FURTHER DOCUMENTS WERE THE SAID LAND WAS USED FOR AGRICULTURAL PURPOSES BY ONE, SHRI SATISH MURMU, WHO WAS RECORDED AS BURGADAR OF THE AFORESAID LAND. THE SAID, SATISH MURMU, CARRIED OUT AGRICULTURAL OPERATIONS IN CONSIDERATION OF UNDERTAKING THAT HE WOULD LOOK AFTER THE LANDS F OR AND ON BEHALF OF THE PARTNERSHIP FIRM. A COPY OF THE CERTIFICATE DT. 26/08/2010 ISSUED BY PANTRA GRAM PANCHAYAT, WAS FURNISHED. THE ASSESSING OFFICER CONCLUDED THAT THE SUBMISSIONS OF THE ASSESSEE WAS CONTRADICTORY FOR THE REASON THAT, IT WAS ST ATED THAT THE LANDS WERE PURCHASED AS INVESTMENT AND ON THE OTHER HAND IT WAS CLAIMED THAT CERTAIN PERSON IS CARRYING OUT AGRICULTURAL ACTIVITIES FOR AND ON BEHALF OF THE PARTNERSHIP FIRM. THEREAFTER, THE ASSESSING OFFICER HELD THAT THE LAND IN NOT AGRICULTURAL LAND, BY APPLYING THE FEW TESTS LAID DOWN BY THE HONBLE COURTS FOR DETERMINING WHETHER A LAND IS AGRICULTURAL OR NOT. THE TESTS APPLIED ARE AS UNDER: - WHETHER THE LAND WAS ACTUALLY OR ORDINARILY AGRICULTURAL PURPOSES AT OR ABOUT THE RELEVANT TIME; WHETHER THE LAND, THOUGH ENTERED IN THE REVENUE RECORDS, HAD NEVER BEEN ACTUALLY USED FOR AGRICULTURE; WHETHER THE OWNER MEAN OR INTENDED TO USE IT FOR AGRICULTURAL PURPOSES; WHETHER THE INCOME DERIVED FROM THE AGRICULTURAL O BEAR ANY RATIONAL PROPORTION TO THE INVESTMENT MADE IN PURCHASING THE LAND ; HE HELD THAT THE LAND WAS IRRECOVERABLY CONVERTED INTO INDUSTRIAL LAND AND THAT THE INTENTIONS OF THE OWNERS WAS DEFINITELY NOT TO PROMOTE AGRICULTURAL I.T.A. NO. 981/KOL/2018 ASSESSMENT YEAR: 2011-12 SANJEEV KUMAR GOYAL ELECTRICITY LINE, WATER LINE, TELEPHONE LINE, GAS LINE ETC. ON PATH AND IN REPLY TO A FURTHER SHOWCAUSE NOTICE DT. 07/03/2014, THE ASSESSEE THE AGRICULTURAL LANDS WERE PURCHASED BY THE PARTNERSHIP FIRMS AS INVESTMENT AND THIS PARTNERSHIP FIRM HAD NEVER APPLIED FOR A PERMANENT ACCOUNT NO. (PAN). BOOKS OF ACCOUNTS AND FURTHER DOCUMENTS WERE THE SAID LAND WAS USED FOR AGRICULTURAL PURPOSES BY ONE, SHRI SATISH MURMU, OF THE AFORESAID LAND. THE SAID, SATISH MURMU, CARRIED OUT AGRICULTURAL OPERATIONS IN CONSIDERATION OF UNDERTAKING OR AND ON BEHALF OF THE PARTNERSHIP FIRM. A COPY OF THE CERTIFICATE DT. 26/08/2010 ISSUED BY PANTRA GRAM THE ASSESSING OFFICER CONCLUDED THAT THE SUBMISSIONS OF THE ASSESSEE WAS ATED THAT THE LANDS WERE PURCHASED AS INVESTMENT AND ON THE OTHER HAND IT WAS CLAIMED THAT CERTAIN PERSON IS CARRYING OUT AGRICULTURAL ACTIVITIES FOR AND ON BEHALF OF THE PARTNERSHIP FIRM. THEREAFTER, THE ASSESSING OFFICER HELD THAT THE LAND IN NOT AGRICULTURAL LAND, BY APPLYING THE FEW TESTS LAID DOWN BY THE HONBLE COURTS FOR DETERMINING WHETHER A LAND IS AGRICULTURAL OR NOT. ORDINARILY USED FOR THE RELEVANT TIME; WHETHER THE LAND, THOUGH ENTERED IN THE REVENUE RECORDS, HAD NEVER BEEN ACTUALLY USED FOR AGRICULTURE; WHETHER THE OWNER MEAN OR INTENDED TO USE IT FOR AGRICULTURAL PURPOSES; WHETHER THE INCOME DERIVED FROM THE AGRICULTURAL O PERATIONS BEAR ANY RATIONAL PROPORTION TO THE INVESTMENT MADE IN HE HELD THAT THE LAND WAS IRRECOVERABLY CONVERTED INTO INDUSTRIAL LAND AND THAT THE INTENTIONS OF THE OWNERS WAS DEFINITELY NOT TO PROMOTE AGRICULTURAL ACTIVITY BUT TO GAIN MAXIMUM FROM THE SALE OF LAND. THE LAND WAS INDUSTRIAL LAND AT THE TIME OF SALE WITH A CONSTRUCTED INDUSTRIAL SHED EVEN AT THE TIME OF PURCHASE. ON THE CONTENTION THAT THE LAND WAS SOLD BY THE PARTNERSHIP FIRM M/S. SHREE ANNAPURNA OIL MILLS AND THA HANDS OF THE ASSESSEE, THE ASSESSING OFFICER HELD THAT PROFITS ARE TAXABLE IN THE HANDS OF THE ASSESSEE FOR THE REASON THAT M/S. SHREE ANNAPURNA OIL MILLS, DOES NOT POSSESS A PAN NOR HAS IT FILED ITS THE PARTNERSHIP FIRM, FOR THE PURPOSE OF INCOME TAX, IS A NON THE TRANSACTIONS WERE UNREPORTED BY THE ASSESSEE AND WOULD NOT HAVE BEEN DISCLOSED BUT FOR THE FACT THAT THE CASE WAS SELECT INVOKED SECTION 50C OF THE ACT AND AFTER DIVIDING THE CAPITAL GAINS FOUR PARTNERS, WHO WERE TREATED AS CO GAIN AMOUNTING TO RS.65,16,420/ 3. AGGRIEVED, THE ASSESSEE CARRIED THE MATTER IN APPEAL. THE LD. FIRST APPELLATE AUTHORITY AT PAGE 8 TO 10 OF HIS ORDER LISTED OUT THE TESTS LAID DOWN BY THE VARIOUS COURTS FOR DETERMINING AS TO WHETHER A PARTICULAR LAND IS AGRICULTURAL LAND OR NOT THESE ARE EXTRACTED FOR READY REFERENCE: 1. WHETHER THE LAND WAS CLASSIFIED IN THE REVENUE RECORD AS AGRICULTURAL AND WHETHER IT WAS SUBJECT TO THE PAYMENT OF LAND REVENUE? 2. WHETHER THE LAND WAS ACTUALLY OR ORDINARILY USED FOR AGRICULTURAL PURPOSES AT OR ABO UT THE RELEVANT TIME? 3. WHETHER SUCH USER OF THE LAND WAS FOR A LONG PERIOD OR WHETHER IT WAS OF A TEMPORARY CHARACTER OR BY WAY OF A STOP 4. WHETHER THE INCOME DERIVED FROM THE AGRICULTURAL OPERATIONS CARRIED ON IN THE LAND BORE ANY RATIONA L PROPORTION TO THE INVE 5. WHETHER THE PERMISSION UNDER SECTION 65 OF THE BOMBAY LAND REVENUE CODE WAS OBTAINED FOR THE NON (THE VENDOR OR THE VENDEE)? WHETHER SUC OR A PORTION OF THE LAND? IF THE PERMISSION WAS IN RESPECT OF A PORTION OF THE LAND AND IF IT WAS OBTAINED IN THE PAST, WHAT WAS THE NATURE OF THE USER OF THE SAID PORTION OF THE LAND ON THE MATERIAL DATE? 6. WHETHE R THE LAND, ON THE RELEVANT DATE, HAD CEASED TO BE PUT TO THE AGRICULTURAL USE? IF SO, WHETHER IT WAS PUT TO AN ALTERNATIVE USE? WHETHER, SUCH CESSER AND/OR ALTERNATIVE USER WAS OF A PERMANENT OR TEMPORARY NATURE? 6 TO GAIN MAXIMUM FROM THE SALE OF LAND. THE LAND WAS INDUSTRIAL LAND AT THE TIME OF SALE WITH A CONSTRUCTED INDUSTRIAL SHED EVEN AT THE TIME OF PURCHASE. ON THE CONTENTION THAT THE LAND WAS SOLD BY THE PARTNERSHIP FIRM M/S. SHREE ANNAPURNA OIL MILLS AND THA T THE CAPITAL GAINS IN QUESTION CANNOT BE TAXED IN THE HANDS OF THE ASSESSEE, THE ASSESSING OFFICER HELD THAT PROFITS ARE TAXABLE IN THE HANDS OF THE ASSESSEE FOR THE REASON THAT M/S. SHREE ANNAPURNA OIL MILLS, DOES NOT POSSESS A PAN NOR HAS IT FILED ITS INCOME TAX RETURN WITH THE ITO. HE CONCLUDED THAT THE PARTNERSHIP FIRM, FOR THE PURPOSE OF INCOME TAX, IS A NON - ENTITY. HE HELD THAT THE TRANSACTIONS WERE UNREPORTED BY THE ASSESSEE AND WOULD NOT HAVE BEEN DISCLOSED BUT FOR THE FACT THAT THE CASE WAS SELECT ED FOR SCRUTINY. THEREAFTER, HE INVOKED SECTION 50C OF THE ACT AND AFTER DIVIDING THE CAPITAL GAINS FOUR PARTNERS, WHO WERE TREATED AS CO - OWNERS, BROUGHT TO TAX, LONG TERM CAPITAL GAIN AMOUNTING TO RS.65,16,420/ - IN THE HANDS OF THE ASSESSEE. AGGRIEVED, THE ASSESSEE CARRIED THE MATTER IN APPEAL. THE LD. FIRST APPELLATE AUTHORITY AT PAGE 8 TO 10 OF HIS ORDER LISTED OUT THE TESTS LAID DOWN BY THE VARIOUS FOR DETERMINING AS TO WHETHER A PARTICULAR LAND IS AGRICULTURAL LAND OR NOT ARE EXTRACTED FOR READY REFERENCE: - 1. WHETHER THE LAND WAS CLASSIFIED IN THE REVENUE RECORD AS AGRICULTURAL AND WHETHER IT WAS SUBJECT TO THE PAYMENT OF LAND REVENUE? 2. WHETHER THE LAND WAS ACTUALLY OR ORDINARILY USED FOR AGRICULTURAL PURPOSES AT UT THE RELEVANT TIME? 3. WHETHER SUCH USER OF THE LAND WAS FOR A LONG PERIOD OR WHETHER IT WAS OF A TEMPORARY CHARACTER OR BY WAY OF A STOP -GAP ARRANGEMENT? 4. WHETHER THE INCOME DERIVED FROM THE AGRICULTURAL OPERATIONS CARRIED ON IN THE L PROPORTION TO THE INVE STMENT MADE IN PURCHASING THE LAND? 5. WHETHER THE PERMISSION UNDER SECTION 65 OF THE BOMBAY LAND REVENUE CODE WAS OBTAINED FOR THE NON - AGRICULTURAL USE OF THE LAND? IF SO, WHEN AND BY WHOM (THE VENDOR OR THE VENDEE)? WHETHER SUC H PERMISSION WAS IN RESPECT OF THE WHOLE OR A PORTION OF THE LAND? IF THE PERMISSION WAS IN RESPECT OF A PORTION OF THE LAND AND IF IT WAS OBTAINED IN THE PAST, WHAT WAS THE NATURE OF THE USER OF THE SAID PORTION OF THE LAND ON THE MATERIAL DATE? R THE LAND, ON THE RELEVANT DATE, HAD CEASED TO BE PUT TO THE AGRICULTURAL USE? IF SO, WHETHER IT WAS PUT TO AN ALTERNATIVE USE? WHETHER, SUCH CESSER AND/OR ALTERNATIVE USER WAS OF A PERMANENT OR TEMPORARY NATURE? I.T.A. NO. 981/KOL/2018 ASSESSMENT YEAR: 2011-12 SANJEEV KUMAR GOYAL TO GAIN MAXIMUM FROM THE SALE OF LAND. THE LAND WAS INDUSTRIAL LAND AT THE TIME OF SALE WITH A CONSTRUCTED INDUSTRIAL SHED EVEN AT THE TIME OF PURCHASE. ON THE CONTENTION THAT THE LAND WAS SOLD BY THE PARTNERSHIP FIRM M/S. SHREE T THE CAPITAL GAINS IN QUESTION CANNOT BE TAXED IN THE HANDS OF THE ASSESSEE, THE ASSESSING OFFICER HELD THAT PROFITS ARE TAXABLE IN THE HANDS OF THE ASSESSEE FOR THE REASON THAT M/S. SHREE ANNAPURNA OIL MILLS, DOES NOT WITH THE ITO. HE CONCLUDED THAT ENTITY. HE HELD THAT THE TRANSACTIONS WERE UNREPORTED BY THE ASSESSEE AND WOULD NOT HAVE BEEN ED FOR SCRUTINY. THEREAFTER, HE INVOKED SECTION 50C OF THE ACT AND AFTER DIVIDING THE CAPITAL GAINS BETWEEN THE OWNERS, BROUGHT TO TAX, LONG TERM CAPITAL AGGRIEVED, THE ASSESSEE CARRIED THE MATTER IN APPEAL. THE LD. FIRST APPELLATE AUTHORITY AT PAGE 8 TO 10 OF HIS ORDER LISTED OUT THE TESTS LAID DOWN BY THE VARIOUS FOR DETERMINING AS TO WHETHER A PARTICULAR LAND IS AGRICULTURAL LAND OR NOT . 1. WHETHER THE LAND WAS CLASSIFIED IN THE REVENUE RECORD AS AGRICULTURAL AND 2. WHETHER THE LAND WAS ACTUALLY OR ORDINARILY USED FOR AGRICULTURAL PURPOSES AT 3. WHETHER SUCH USER OF THE LAND WAS FOR A LONG PERIOD OR WHETHER IT WAS OF A 4. WHETHER THE INCOME DERIVED FROM THE AGRICULTURAL OPERATIONS CARRIED ON IN THE STMENT MADE IN PURCHASING THE LAND? 5. WHETHER THE PERMISSION UNDER SECTION 65 OF THE BOMBAY LAND REVENUE CODE AGRICULTURAL USE OF THE LAND? IF SO, WHEN AND BY WHOM H PERMISSION WAS IN RESPECT OF THE WHOLE OR A PORTION OF THE LAND? IF THE PERMISSION WAS IN RESPECT OF A PORTION OF THE LAND AND IF IT WAS OBTAINED IN THE PAST, WHAT WAS THE NATURE OF THE USER OF THE SAID R THE LAND, ON THE RELEVANT DATE, HAD CEASED TO BE PUT TO THE AGRICULTURAL USE? IF SO, WHETHER IT WAS PUT TO AN ALTERNATIVE USE? WHETHER, SUCH CESSER AND/OR 7. WHETHER THE LAND, THOUGH ENTERED IN REV USED FOR AGRICULTURE, THAT IS, IT HAD NEVER BEEN PLOUGHED OR TILLED? WHETHER THE OWNER MEANT OR INTENDED TO USE IT FOR AGRICULTURAL PURPOSES? 8. WHETHER THE LAND WAS SITUATE IN A DEVELOPED AREA? WHETHER ITS PHYSICAL CHA RACTERISTICS, SURROUNDING SITUATION AND USE OF THE LANDS IN THE ADJOINING AREA WERE SUCH AS WOULD INDICATE THAT THE LAND WAS AGRICULTURAL? 9. WHETHER THE LAND ITSELF WAS DEVELOPED BY PLOTTING AND PROVIDING ROADS AND OTHER FACILITIES? 10. WHETHER THERE WERE AGRICULTURAL USE? 11. WHETHER PERMISSION UNDER SECTION 63 OF THE BOMBAY TENANCY AND AGRICULTURAL LANDS ACT, 1948, WAS OBTAINED BECAUSE THE SALE OR INTEND ED SALE WAS IN FAVOUR OF A NON- AGRICULTURIST? IF S AGRICULTURIST WAS FOR NON 12. WHETHER THE LAND WAS SOLD ON YARDAGE OR ON ACREAGE BASIS? 13. WHETHER AN AGRICULTURIST WOULD PURCHASE THE LAND FOR AGRICULTURAL PURPOSES AT THE PRICE AT WHICH THE LAND WAS SOLD AND WHETHER THE OWNER WOULD HAVE EVER SOLD THE LAND VALUING IT AS A PROPERTY YIELDING AGRICULTURAL PRODUCE ON THE BASIS OF ITS YIELD? 4.1. THEREAFTER, HE EXAMINED THE FACTS OF THE CASE AND A) NO AGRICULT URAL ACTIVITY WAS DONE SINCE LAST SO MANY YEARS OVER THE LAND IN QUESTION. B) THE PURPOSE OF PURCHASE OF LAND WAS NOT TO DO AGRICULTURAL ACTIVITY. C) THE BUYER ALSO USED THE LAND FOR INDUSTRIAL PURPOSES. D) THE INVESTMENT WAS MADE SIMPLY WITH A PROFIT MOTIVE. E) THE I NTENTION WAS NOT TO CARRY ON ANY BUSINESS IN THE NAME OF THE FIRM. F) THOUGH THE LAND IS SURROUNDING AREAS ARE COVERED BY THE INDUSTRIAL UNITS AND THE SAID PLOT OF LAND, HAS ALREADY LOST ITS CHARACTER OF BEING AGRICULT AND CAN ALWAYS BE SAID TO BE AN INDUSTRIAL PLOT IN THE LIGHT OF OTHER INDUSTRIAL PLOTS THOUGH THE SAME WAS NOT CONVERTED BY THE ASSESSEE. THUS, HE CONCLUDED THAT THE CHARACTER OF THE LAND IS NON 4.2. THEREAFTER, ON THE ISSUE AS TO I TO BE ASSESSED H E HELD THAT THE ADDITION IN QUESTION CANNOT BE MADE IN THE NAME OF THE PARTNERS OF M/S. SHREE ANNAPURNA OIL MI 7 7. WHETHER THE LAND, THOUGH ENTERED IN REV ENUE RECORD, HAD NEVER BEEN ACTUALLY USED FOR AGRICULTURE, THAT IS, IT HAD NEVER BEEN PLOUGHED OR TILLED? WHETHER THE OWNER MEANT OR INTENDED TO USE IT FOR AGRICULTURAL PURPOSES? 8. WHETHER THE LAND WAS SITUATE IN A DEVELOPED AREA? WHETHER ITS PHYSICAL RACTERISTICS, SURROUNDING SITUATION AND USE OF THE LANDS IN THE ADJOINING AREA WERE SUCH AS WOULD INDICATE THAT THE LAND WAS AGRICULTURAL? 9. WHETHER THE LAND ITSELF WAS DEVELOPED BY PLOTTING AND PROVIDING ROADS AND 10. WHETHER THERE WERE ANY PREVIOUS SALES OF PORTIONS OF THE LAND FOR NON 11. WHETHER PERMISSION UNDER SECTION 63 OF THE BOMBAY TENANCY AND AGRICULTURAL LANDS ACT, 1948, WAS OBTAINED BECAUSE THE SALE OR INTEND ED SALE WAS IN FAVOUR OF AGRICULTURIST? IF S O, WHETHER THE SALE OR INTENDED SALE TO SUCH NON AGRICULTURIST WAS FOR NON -AGRICULTURAL OR AGRICULTURAL USER. 12. WHETHER THE LAND WAS SOLD ON YARDAGE OR ON ACREAGE BASIS? 13. WHETHER AN AGRICULTURIST WOULD PURCHASE THE LAND FOR AGRICULTURAL PURPOSES AT THE PRICE AT WHICH THE LAND WAS SOLD AND WHETHER THE OWNER WOULD HAVE EVER SOLD THE LAND VALUING IT AS A PROPERTY YIELDING AGRICULTURAL PRODUCE ON THE BASIS OF ITS HE EXAMINED THE FACTS OF THE CASE AND HELD AS FOLLOWS: URAL ACTIVITY WAS DONE SINCE LAST SO MANY YEARS OVER THE LAND IN QUESTION. THE PURPOSE OF PURCHASE OF LAND WAS NOT TO DO AGRICULTURAL ACTIVITY. THE BUYER ALSO USED THE LAND FOR INDUSTRIAL PURPOSES. THE INVESTMENT WAS MADE SIMPLY WITH A PROFIT MOTIVE. NTENTION WAS NOT TO CARRY ON ANY BUSINESS IN THE NAME OF THE THOUGH THE LAND IS CLAIMED TO BE AGRICULTURAL LAND, ALL THE SURROUNDING AREAS ARE COVERED BY THE INDUSTRIAL UNITS AND THE SAID PLOT OF LAND, HAS ALREADY LOST ITS CHARACTER OF BEING AGRICULT AND CAN ALWAYS BE SAID TO BE AN INDUSTRIAL PLOT IN THE LIGHT OF OTHER INDUSTRIAL PLOTS THOUGH THE SAME WAS NOT CONVERTED BY THE ASSESSEE. THUS, HE CONCLUDED THAT THE CHARACTER OF THE LAND IS NON - AGRICULTURAL. ON THE ISSUE AS TO I N WHICH ASSESSEES HAND THIS CAPITAL GAIN HAS E HELD THAT THE ADDITION IN QUESTION CANNOT BE MADE IN THE NAME OF THE PARTNERS OF M/S. SHREE ANNAPURNA OIL MI LLS. HE DELETED THE ADDITION IN THE I.T.A. NO. 981/KOL/2018 ASSESSMENT YEAR: 2011-12 SANJEEV KUMAR GOYAL ENUE RECORD, HAD NEVER BEEN ACTUALLY USED FOR AGRICULTURE, THAT IS, IT HAD NEVER BEEN PLOUGHED OR TILLED? WHETHER THE 8. WHETHER THE LAND WAS SITUATE IN A DEVELOPED AREA? WHETHER ITS PHYSICAL RACTERISTICS, SURROUNDING SITUATION AND USE OF THE LANDS IN THE ADJOINING AREA 9. WHETHER THE LAND ITSELF WAS DEVELOPED BY PLOTTING AND PROVIDING ROADS AND ANY PREVIOUS SALES OF PORTIONS OF THE LAND FOR NON - 11. WHETHER PERMISSION UNDER SECTION 63 OF THE BOMBAY TENANCY AND AGRICULTURAL LANDS ACT, 1948, WAS OBTAINED BECAUSE THE SALE OR INTEND ED SALE WAS IN FAVOUR OF O, WHETHER THE SALE OR INTENDED SALE TO SUCH NON - 13. WHETHER AN AGRICULTURIST WOULD PURCHASE THE LAND FOR AGRICULTURAL PURPOSES AT THE PRICE AT WHICH THE LAND WAS SOLD AND WHETHER THE OWNER WOULD HAVE EVER SOLD THE LAND VALUING IT AS A PROPERTY YIELDING AGRICULTURAL PRODUCE ON THE BASIS OF ITS HELD AS FOLLOWS: - URAL ACTIVITY WAS DONE SINCE LAST SO MANY YEARS OVER THE THE PURPOSE OF PURCHASE OF LAND WAS NOT TO DO AGRICULTURAL ACTIVITY. NTENTION WAS NOT TO CARRY ON ANY BUSINESS IN THE NAME OF THE CLAIMED TO BE AGRICULTURAL LAND, ALL THE SURROUNDING AREAS ARE COVERED BY THE INDUSTRIAL UNITS AND THE SAID PLOT OF LAND, HAS ALREADY LOST ITS CHARACTER OF BEING AGRICULT URAL LAND AND CAN ALWAYS BE SAID TO BE AN INDUSTRIAL PLOT IN THE LIGHT OF OTHER INDUSTRIAL PLOTS THOUGH THE SAME WAS NOT CONVERTED BY THE ASSESSEE. AGRICULTURAL. N WHICH ASSESSEES HAND THIS CAPITAL GAIN HAS E HELD THAT THE ADDITION IN QUESTION CANNOT BE MADE IN THE NAME OF HE DELETED THE ADDITION IN THE HANDS OF THE ASSESSEE ON THIS GROUND AND HELD THA IN THE HANDS OF THE PARTNERSHIP FIRM M/S. SHREE ANNAPURNA OIL MILLS. DIRECTED AS FOLLOWS:- CONSIDERING THE FACTS NARRATED ABOVE AND SUBMISSION OF THE APPELLANT AND EVIDENCES EXAMINED DURING THE COURSE OF APPELLATE PROCEEDINGS THE ADDITIONS MADE IN THE HANDS OF THE PARTNERS IS HERE BY DELETED AND THE AO IS DIRECTED TO TAX THE SAME IN THE HANDS O MADE IN THE FOREGOING PARAS, THE ADDITION MADE IN THE HANDS OF THE APPELLANT IS HEREBY DIRECTED TO BE DELETED AND THE AO IS DIRECTED TO RE THE SAME IN THE HANDS OF THE FIRM. AS REGARDS THE APPLICABILITY OF SECTION 50C IS CONCERN IT IS HELD THAT THE AO HAS RIGHTLY APPLIED THE PROVISIONS AS ITS CHARACTER WAS NOT AGRICULTURE LAND AS IT IS HELD IN THE DECISIONS OF THE HONBLE RAJASTHAN HIGH COURT IN THE CASE OF MAHAVEER ENTERPRISES V 5. AGGRIEVED, THE ASSESSEE IS IN APPEAL BEFORE US ON THE FOLLOWING GROUNDS: 1. THAT, ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE, THE LD. COMMISSIONER OF INCOME TAX (APPEALS) ARISING ON SALE OF IMMOVEABLE PROPERTY BEING LANDS SOLD BY THE PARTNERSHIP FIRM M/S SHREE ANNAPURNA OIL MILLS VIDE TWO DOCUMENTS BEARING NO. 4482 OF 2010 AND 4483 OF 2010 REGISTERED WITH THE ADDL. DIST. SUB REGISTRAR, HARIPAL AN AGRICULTURAL LAND. 2. THAT, THE LEARNED COMMISSIONER OF INCOME TAX (APPEALS) ERRED IN CONCLUDING THAT THE PROVISIONS OF SECTION 50C OF THE ACT ARE APPLICABLE TO THIS CASE SINCE THE LAND SOLD BY THE PARTNERSHIP FIRM M/S SHREE ANNAPURNA OIL MILL AGRICULTURAL LAND. 3. THAT THE LEARNED COMMISSIONER OF INCOME TAX (APPEALS) ERRED IN DRAWING AFORESAID CONCLUSIONS THAT THE LAND SOLD BY THE PARTNERSHIP FIRM M/S SHREE ANNAPURNA OIL MILLS WAS NOT AGRICULTURAL LAND WHEN THE SAME LAND WAS HELD TO BE THE AGRICULTURAL LAND BY TH ASSESSMENT ORDER PASSED UNDER SECTION 143(3) OF THE ACT IN THE CASE OF SRI RAJEEV KUMAR GOYAL ANOTHER PARTNER OF THE AFORESAID PARTNERSHIP FIRM. 4. THAT, VARIOUS CONCLUSIONS DRAWN BY LEARNED COMMISSIONER OF INCOME TAX (APPEALS) TO HOLD THAT THE LAND SOLD BY THE PARTNERSHIP FIRM M/S SHREE ANNAPURNA OIL MILLS ARE PERVERSE BASED ON SOME FACTS WHICH ARE CONTRARY TO RECORDS AND WRONGLY RELYING ON JUDGEM APPLICABLE TO THE FACTS OF THIS CASE. 5. THAT THE LD. COMMISSIONER OF INCOME TAX (APPEALS) ERRED IN HOLDING THAT THE PROVISIONS OF SECTION 50C ARE APPLICABLE IN AS MUCH AS THE LAND IN QUESTION WAS NOT AN AGRICULTURAL LAND. 6. THAT WITHOUT PREJUDICE TO GROUND NO. 5 ABOVE, THE LD. COMMISSIONER OF INCOME TAX (APPEALS) ERRED IN CONCURRING WITH THE ASSESSING OFFICER'S DECISION TO APPLY THE PROVISIONS OF SECTION 50C OF THE ACT INSPITE OF THE FACT THAT THE 8 HANDS OF THE ASSESSEE ON THIS GROUND AND HELD THA T THE CAPITAL GAIN IS TAXABLE ONLY IN THE HANDS OF THE PARTNERSHIP FIRM M/S. SHREE ANNAPURNA OIL MILLS. HE THEREAFTER CONSIDERING THE FACTS NARRATED ABOVE AND SUBMISSION OF THE APPELLANT AND EVIDENCES EXAMINED DURING THE COURSE OF APPELLATE PROCEEDINGS THE ADDITIONS MADE IN THE HANDS OF THE PARTNERS IS HERE BY DELETED AND THE AO IS DIRECTED TO TAX THE SAME IN THE HANDS O F THE FIRM. KEEPIN IN VIEW OF THE AFORESAID OBSERVATION MADE IN THE FOREGOING PARAS, THE ADDITION MADE IN THE HANDS OF THE APPELLANT IS HEREBY DIRECTED TO BE DELETED AND THE AO IS DIRECTED TO RE - OPEN THE CASE AND TAX THE SAME IN THE HANDS OF THE FIRM. REGARDS THE APPLICABILITY OF SECTION 50C IS CONCERN IT IS HELD THAT THE AO HAS RIGHTLY APPLIED THE PROVISIONS AS ITS CHARACTER WAS NOT AGRICULTURE LAND AS IT IS HELD IN THE DECISIONS OF THE HONBLE RAJASTHAN HIGH COURT IN THE CASE OF MAHAVEER ENTERPRISES V S. UOI [2001] 244 ITR 789 /[1997] 95 TAXMAN 220. AGGRIEVED, THE ASSESSEE IS IN APPEAL BEFORE US ON THE FOLLOWING GROUNDS: 1. THAT, ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE, THE LD. COMMISSIONER OF INCOME TAX (APPEALS) - 13, KOLKATA ERRED IN HOLDING THAT THE CAPITAL GAINS ARISING ON SALE OF IMMOVEABLE PROPERTY BEING LANDS SOLD BY THE PARTNERSHIP FIRM M/S SHREE ANNAPURNA OIL MILLS VIDE TWO DOCUMENTS BEARING NO. 4482 OF 2010 AND 4483 OF 2010 REGISTERED WITH THE ADDL. DIST. SUB REGISTRAR, HARIPAL 2. THAT, THE LEARNED COMMISSIONER OF INCOME TAX (APPEALS) ERRED IN CONCLUDING THAT THE PROVISIONS OF SECTION 50C OF THE ACT ARE APPLICABLE TO THIS CASE SINCE THE LAND SOLD BY THE PARTNERSHIP FIRM M/S SHREE ANNAPURNA OIL MILL WAS NOT AN 3. THAT THE LEARNED COMMISSIONER OF INCOME TAX (APPEALS) ERRED IN DRAWING AFORESAID CONCLUSIONS THAT THE LAND SOLD BY THE PARTNERSHIP FIRM M/S SHREE ANNAPURNA OIL MILLS WAS NOT AGRICULTURAL LAND WHEN THE SAME LAND WAS HELD TO BE THE AGRICULTURAL LAND BY TH E INCOME TAX OFFICER, WARD 43(1), KOLKATA IN ASSESSMENT ORDER PASSED UNDER SECTION 143(3) OF THE ACT IN THE CASE OF SRI RAJEEV KUMAR GOYAL ANOTHER PARTNER OF THE AFORESAID PARTNERSHIP FIRM. 4. THAT, VARIOUS CONCLUSIONS DRAWN BY LEARNED COMMISSIONER OF INCOME TAX (APPEALS) TO HOLD THAT THE LAND SOLD BY THE PARTNERSHIP FIRM M/S SHREE ANNAPURNA OIL MILLS ARE PERVERSE BASED ON SOME FACTS WHICH ARE CONTRARY TO RECORDS AND WRONGLY RELYING ON JUDGEM ENTS WHICH ARE DISTINGUISHABLE AND NOT APPLICABLE TO THE FACTS OF THIS CASE. 5. THAT THE LD. COMMISSIONER OF INCOME TAX (APPEALS) ERRED IN HOLDING THAT THE PROVISIONS OF SECTION 50C ARE APPLICABLE IN AS MUCH AS THE LAND IN QUESTION WAS LAND. 6. THAT WITHOUT PREJUDICE TO GROUND NO. 5 ABOVE, THE LD. COMMISSIONER OF INCOME TAX (APPEALS) ERRED IN CONCURRING WITH THE ASSESSING OFFICER'S DECISION TO APPLY THE PROVISIONS OF SECTION 50C OF THE ACT INSPITE OF THE FACT THAT THE I.T.A. NO. 981/KOL/2018 ASSESSMENT YEAR: 2011-12 SANJEEV KUMAR GOYAL T THE CAPITAL GAIN IS TAXABLE ONLY HE THEREAFTER CONSIDERING THE FACTS NARRATED ABOVE AND SUBMISSION OF THE APPELLANT AND EVIDENCES EXAMINED DURING THE COURSE OF APPELLATE PROCEEDINGS THE ADDITIONS MADE IN THE HANDS OF THE PARTNERS IS HERE BY DELETED AND THE AO IS DIRECTED TO TAX F THE FIRM. KEEPIN IN VIEW OF THE AFORESAID OBSERVATION MADE IN THE FOREGOING PARAS, THE ADDITION MADE IN THE HANDS OF THE APPELLANT IS OPEN THE CASE AND TAX REGARDS THE APPLICABILITY OF SECTION 50C IS CONCERN IT IS HELD THAT THE AO HAS RIGHTLY APPLIED THE PROVISIONS AS ITS CHARACTER WAS NOT AGRICULTURE LAND AS IT IS HELD IN THE DECISIONS OF THE HONBLE RAJASTHAN HIGH COURT IN THE CASE OF /[1997] 95 TAXMAN 220. AGGRIEVED, THE ASSESSEE IS IN APPEAL BEFORE US ON THE FOLLOWING GROUNDS: - 1. THAT, ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE, THE LD. COMMISSIONER HOLDING THAT THE CAPITAL GAINS ARISING ON SALE OF IMMOVEABLE PROPERTY BEING LANDS SOLD BY THE PARTNERSHIP FIRM M/S SHREE ANNAPURNA OIL MILLS VIDE TWO DOCUMENTS BEARING NO. 4482 OF 2010 AND 4483 OF 2010 REGISTERED WITH THE ADDL. DIST. SUB REGISTRAR, HARIPAL WAS NOT 2. THAT, THE LEARNED COMMISSIONER OF INCOME TAX (APPEALS) ERRED IN CONCLUDING THAT THE PROVISIONS OF SECTION 50C OF THE ACT ARE APPLICABLE TO THIS CASE SINCE THE WAS NOT AN 3. THAT THE LEARNED COMMISSIONER OF INCOME TAX (APPEALS) ERRED IN DRAWING AFORESAID CONCLUSIONS THAT THE LAND SOLD BY THE PARTNERSHIP FIRM M/S SHREE ANNAPURNA OIL MILLS WAS NOT AGRICULTURAL LAND WHEN THE SAME LAND WAS HELD TO E INCOME TAX OFFICER, WARD 43(1), KOLKATA IN ASSESSMENT ORDER PASSED UNDER SECTION 143(3) OF THE ACT IN THE CASE OF SRI RAJEEV 4. THAT, VARIOUS CONCLUSIONS DRAWN BY LEARNED COMMISSIONER OF INCOME TAX (APPEALS) TO HOLD THAT THE LAND SOLD BY THE PARTNERSHIP FIRM M/S SHREE ANNAPURNA OIL MILLS ARE PERVERSE BASED ON SOME FACTS WHICH ARE CONTRARY TO ENTS WHICH ARE DISTINGUISHABLE AND NOT 5. THAT THE LD. COMMISSIONER OF INCOME TAX (APPEALS) ERRED IN HOLDING THAT THE PROVISIONS OF SECTION 50C ARE APPLICABLE IN AS MUCH AS THE LAND IN QUESTION WAS 6. THAT WITHOUT PREJUDICE TO GROUND NO. 5 ABOVE, THE LD. COMMISSIONER OF INCOME TAX (APPEALS) ERRED IN CONCURRING WITH THE ASSESSING OFFICER'S DECISION TO APPLY THE PROVISIONS OF SECTION 50C OF THE ACT INSPITE OF THE FACT THAT THE ASSESSING OFFICER REFUSED TO REFER THE MATTER OF VALUATION TO OVA ALTHOUGH THE APPELLANT SPECIFICALLY REQUESTED FOR SUCH REFERENCE TO DVO. 7. THAT THE LEARNED COMMISSIONER OF INCOME TAX (APPEALS) EXCEEDED HIS JURISDICTION TO DIRECT THE ASSESSING OFFICER TO INITIATE THE ASS THE SAID AMOUNT IN THE HANDS OF THE PARTNERSHIP FIRM. 8. THAT THE APPELLANT CRAVES LEAVE TO ADD, ALTER OR WITHDRAW ANY GROUND OR GROUNDS OF APPEAL AT OR BEFORE THE HEARING OF THE APPEAL. 6. ON GROUND NOS. 1 TO 4, T FINDINGS OF THE LD. CIT(A) AS WELL AS THE LD. AO ARE PERVERSE IN AS MUCH AS THE SUBJECT LAND WAS AGRICULTURAL LAND AND THEREFORE THE CAPITAL GAINS ON SALE THEREOF IS NOT LIABLE TO BE TAXED. THE LD. COUNSEL FOR THE ASSESEE BY GRAM PRADHAN, PANTRA GRAM PANCHAYAT PLACED AT PAGE 62 OF THE PAPER BOOK WHEREIN THE GRAM PRADHAN HAS CERTIFIED THAT THE SUBJECT LAND WAS AGRICULTURAL LAND AS PER THE RECORDS OF BLOCK LAND REVENUE OFFICER (BLRO). HE ALSO CERTIFIED THAT THE SAID LAND WAS BEING CULTIVATED BY ONE RECORDED BARGADAR SRI SATISH MURMU AND HIS SON AND THAT THERE WAS NO MUNICI WITHIN 8 KMS. FROM THE SAID AGRICULTURAL LAND. HE ALSO CERTIFIED THAT THE SAID LAND WAS RECORDED AS AGRICULTURAL LAND WHEN THE SAME WAS SOLD BY M/S STP LTD. REFERRED TO THE IMPUGNED ASSESSMENT ORDER WHEREIN THE THROUGH HIS INSPECTOR WHO HIMSELF VISITED THE OFFICE OF THE BUILDING, LAND & REVENUE OFFICER AT HARIPAL, HOOGHLY ON 28.02.2014 TO ENQUIRE ABOUT THE NATURE, LOCATION & TYPE OF THE SUBJECT LAND. THE LAND & REVENUE OFFICER CONFIRMED THAT SAID LAND WAS CONVERTED INTO INDUSTRIAL LAND BY THE PURCHASER I.E. M/S STP LTD WHOM THE LAND WAS SOLD BY THE ASSESSEE REVENUE OFFICER CLEARLY SHOWS THAT THE LAND WAS AN AGRICULTURAL LAND WHEN THE SAME WAS SO LD BY THE FIRM AND THAT THE BUYER HAD GOT THE SAME CONVERTED INTO AN INDUSTRIAL LAND ONLY AFTER ITS PURCHASE FROM THE ASSESSEE. THE ASSESSMENT ORDER FOR THE ASSESSMENT YEAR 2011 SECTION 143(3) OF THE ACT IN T ASSESSEE WHO WAS ALSO A PARTNER IN THE FIRM M/S SHREE ANNAPURNA OIL MILLS AND WHO ALSO SIGNED THE SALE DEED. THE COPY OF THE ASSESSMENT ORDER IS PLACED AT PAGES 76 TO 77 OF THE PAPER BOOK. IN THIS CASE PROPERTY SOLD BY THE ASSESSEE WAS AN AGRICULTURAL LAND AND THEREFORE THE QUESTION 9 REFUSED TO REFER THE MATTER OF VALUATION TO OVA ALTHOUGH THE APPELLANT SPECIFICALLY REQUESTED FOR SUCH REFERENCE TO DVO. 7. THAT THE LEARNED COMMISSIONER OF INCOME TAX (APPEALS) EXCEEDED HIS JURISDICTION TO DIRECT THE ASSESSING OFFICER TO INITIATE THE ASS ESSING OFFICER TO TAX THE SAID AMOUNT IN THE HANDS OF THE PARTNERSHIP FIRM. 8. THAT THE APPELLANT CRAVES LEAVE TO ADD, ALTER OR WITHDRAW ANY GROUND OR GROUNDS OF APPEAL AT OR BEFORE THE HEARING OF THE APPEAL. GROUND NOS. 1 TO 4, T HE LD. COUNSEL FOR THE ASSESSEE SUBMITS THAT FINDINGS OF THE LD. CIT(A) AS WELL AS THE LD. AO ARE PERVERSE IN AS MUCH AS THE SUBJECT LAND WAS AGRICULTURAL LAND AND THEREFORE THE CAPITAL GAINS ON SALE THEREOF IS LD. COUNSEL FOR THE ASSESEE REF ERS TO THE CERTIFICATE ISSUED BY GRAM PRADHAN, PANTRA GRAM PANCHAYAT PLACED AT PAGE 62 OF THE PAPER BOOK HAS CERTIFIED THAT THE SUBJECT LAND WAS AGRICULTURAL LAND AS PER THE RECORDS OF BLOCK LAND REVENUE OFFICER (BLRO). HE ALSO CERTIFIED THAT THE SAID LAND WAS BEING CULTIVATED BY ONE RECORDED BARGADAR SRI SATISH MURMU AND HIS SON AND THAT THERE WAS NO MUNICI PALITY OR DEVELOPMENT AND CANTONMENT BOARD WITHIN 8 KMS. FROM THE SAID AGRICULTURAL LAND. HE ALSO CERTIFIED THAT THE SAID LAND WAS RECORDED AS AGRICULTURAL LAND WHEN THE SAME WAS SOLD BY M/S STP LTD. TO THE IMPUGNED ASSESSMENT ORDER WHEREIN THE LD. AO MADE ENQUIRY THROUGH HIS INSPECTOR WHO HIMSELF VISITED THE OFFICE OF THE BUILDING, LAND & REVENUE OFFICER AT HARIPAL, HOOGHLY ON 28.02.2014 TO ENQUIRE ABOUT THE NATURE, LOCATION & TYPE OF THE SUBJECT LAND. THE LAND & REVENUE OFFICER CONFIRMED THAT SAID LAND WAS CONVERTED INTO INDUSTRIAL LAND BY THE PURCHASER I.E. M/S STP LTD BY THE ASSESSEE . HE RELIED ON THIS STATEMENT OF THE LAND REVENUE OFFICER CLEARLY SHOWS THAT THE LAND WAS AN AGRICULTURAL LAND WHEN THE LD BY THE FIRM AND THAT THE BUYER HAD GOT THE SAME CONVERTED INTO AN AFTER ITS PURCHASE FROM THE ASSESSEE. REFERENCE WAS MADE THE ASSESSMENT ORDER FOR THE ASSESSMENT YEAR 2011 - 12 PASSED BY THE AO UNDER SECTION 143(3) OF THE ACT IN T HE CASE OF SRI RAJEEV KUMAR GOYAL, THE BROTHER OF THE WHO WAS ALSO A PARTNER IN THE FIRM M/S SHREE ANNAPURNA OIL MILLS AND WHO ALSO SIGNED THE SALE DEED. THE COPY OF THE ASSESSMENT ORDER IS PLACED AT PAGES 76 TO 77 OF THE PAPER BOOK. IN THIS CASE THE ASSESSEE THEREIN CONTENDED THAT THE PROPERTY SOLD BY THE ASSESSEE WAS AN AGRICULTURAL LAND AND THEREFORE THE QUESTION I.T.A. NO. 981/KOL/2018 ASSESSMENT YEAR: 2011-12 SANJEEV KUMAR GOYAL REFUSED TO REFER THE MATTER OF VALUATION TO OVA ALTHOUGH THE 7. THAT THE LEARNED COMMISSIONER OF INCOME TAX (APPEALS) EXCEEDED HIS ESSING OFFICER TO TAX 8. THAT THE APPELLANT CRAVES LEAVE TO ADD, ALTER OR WITHDRAW ANY GROUND OR SUBMITS THAT , THE FINDINGS OF THE LD. CIT(A) AS WELL AS THE LD. AO ARE PERVERSE IN AS MUCH AS THE SUBJECT LAND WAS AGRICULTURAL LAND AND THEREFORE THE CAPITAL GAINS ON SALE THEREOF IS ERS TO THE CERTIFICATE ISSUED BY GRAM PRADHAN, PANTRA GRAM PANCHAYAT PLACED AT PAGE 62 OF THE PAPER BOOK , HAS CERTIFIED THAT THE SUBJECT LAND WAS AGRICULTURAL LAND AS PER THE RECORDS OF BLOCK LAND REVENUE OFFICER (BLRO). HE ALSO CERTIFIED THAT THE SAID LAND WAS BEING CULTIVATED BY ONE RECORDED BARGADAR SRI SATISH MURMU AND HIS PALITY OR DEVELOPMENT AND CANTONMENT BOARD WITHIN 8 KMS. FROM THE SAID AGRICULTURAL LAND. HE ALSO CERTIFIED THAT THE SAID LAND WAS RECORDED AS AGRICULTURAL LAND WHEN THE SAME WAS SOLD BY M/S STP LTD. HE LD. AO MADE ENQUIRY THROUGH HIS INSPECTOR WHO HIMSELF VISITED THE OFFICE OF THE BUILDING, LAND & REVENUE OFFICER AT HARIPAL, HOOGHLY ON 28.02.2014 TO ENQUIRE ABOUT THE NATURE, LOCATION & TYPE OF THE SUBJECT LAND. THE LAND & REVENUE OFFICER CONFIRMED THAT THE SAID LAND WAS CONVERTED INTO INDUSTRIAL LAND BY THE PURCHASER I.E. M/S STP LTD . TO THIS STATEMENT OF THE LAND REVENUE OFFICER CLEARLY SHOWS THAT THE LAND WAS AN AGRICULTURAL LAND WHEN THE LD BY THE FIRM AND THAT THE BUYER HAD GOT THE SAME CONVERTED INTO AN REFERENCE WAS MADE TO 12 PASSED BY THE AO UNDER HE CASE OF SRI RAJEEV KUMAR GOYAL, THE BROTHER OF THE WHO WAS ALSO A PARTNER IN THE FIRM M/S SHREE ANNAPURNA OIL MILLS AND WHO ALSO SIGNED THE SALE DEED. THE COPY OF THE ASSESSMENT ORDER IS PLACED AT PAGES THE ASSESSEE THEREIN CONTENDED THAT THE PROPERTY SOLD BY THE ASSESSEE WAS AN AGRICULTURAL LAND AND THEREFORE THE QUESTION OF CAPITAL GAINS DID NOT ARISE. TO VERIFY THE CONTENTIONS OF THE ASSESSEE, THE INCOME TAX OFFICER ON INVESTIGATION FOUND THAT THE PROP WAS BEYOND THE RADIUS OF EIGHT KILOMETRES FROM THE MUNICIPAL AREA. THE INCOME TAX OFFICER THEREUPON HELD THAT THE CAPITAL GAIN ON SALE OF THIS LAND IS NOT TAXABLE. THE SAID ASSESSMENT ORDER REASSESSMENT. IN SUCH CIRCUMSTANCES OF THE CASE, THE LD. AO AS WELL AS THE LD. CIT(A) WAS WHOLLY UNJUSTIFIED IN TAKING A CONTRARY VIEW IN THIS CASE. THE ORDER OF THE THIS BENCH OF THE TRIBUNAL MITTER IN ITA NO. 307/KOL/2012 FAVOUR OF THE CO- OWNER OF THE LANDED PROPERTY. IN THIS CASE THE TRIBUNAL HELD AND OBSERVED AS UNDER: 5. AT THE OUTSET, LD. COUNSEL FOR THE ASSESSEE SUBMITTED THAT THE ISS COVERED IN FAVOUR OF THE ASSESSEE. HE REFERRED TO THE TRIBUNALS DECISION IN THE CASE OF CO- OWNER OF THE PROPERTY SHRI ARIJIT MITRA AS ABOVE AND CONTENDED THAT IN VIEW OF THE AFORESAID TRIBUNAL DECISION, NO CAPITAL GAIN WAS ELIGIBLE IN THE ASSESSEES HANDS. 6. LD. D.R. COULD NOT CONTRADICT TO THIS SUBMISSION OF THE LD. COUNSEL OF ASSESSEE. 7. WE HAVE HEARD THE RIVAL SUBMISSIONS AND PERUSED THE MATERIAL AVAILABLE ON RECORD. WE FIND THAT THIS ISSUE IS SQUARELY COVERED IN FAVOUR OF THE ASSESSEE TRIBUNAL IN THE HANDS OF THE CO QUESTION DID NOT CONSTITUTE CAPITAL ASSET UNDER SECTION 2(14) OF THE INCOME TAX ACT BECAUSE RAJARHAT MUNICIPALITY WAS NOT ONE OF THE NOTIFIED MUNICIPALITY AS PER THE C ENTRAL GOVERNMENTS NOTIFICATION DATED 28.12.1999. HENCE, RESPECTFULLY FOLLOWING THE PRECEDENT, WE HOLD THAT THE LAND IN QUESTION, WHICH WAS TRANSFERRED BY THE ASSESSEE, WAS AN AGRICULTURAL LAND AND IT DID NOT FALL WITHIN THE AMBIT OF CAPITAL ASSET UNDER ACCORDINGLY WE CONFIRM THE ORDER OF LD. CIT(APPEALS). 6.1. THE LD. COUNSEL OF THE ASSESSEE SUBMITTED WAS REGISTERED AS AGRICULTURAL LAND IN THE REVENUE RECORDS AT THE TIME OF PURCHASE AND CONTINUED TO BE SAME WHEN THE LAND WAS SOLD. THE LAND WAS SITUATED IN AN AREA WHICH IS BEYOND 8 KILOMETRES FROM ANY MUNICIPALITY AND LAND WAS NOT A CAPITAL ASSET WITHIN THE MEANING OF SECTION 2(14) OF THE ACT. THE CONVERSION OF LAND FROM AGRICULTURAL TO INDUSTRIAL SUBSEQUENTLY BY THE BUYER OF THE LAND WILL NOT HAVE ANY ADVERSE EFFECT ON ITS CHARGEABIL 10 OF CAPITAL GAINS DID NOT ARISE. TO VERIFY THE CONTENTIONS OF THE ASSESSEE, THE INCOME TAX OFFICER ON INVESTIGATION FOUND THAT THE PROP ERTY WAS AN AGRICULTURAL LAND WHICH WAS BEYOND THE RADIUS OF EIGHT KILOMETRES FROM THE MUNICIPAL AREA. THE INCOME TAX OFFICER THEREUPON HELD THAT THE CAPITAL GAIN ON SALE OF THIS LAND IS NOT TAXABLE. THE SAID ASSESSMENT ORDER BECAME FINAL AND WAS NOT SUBJE CTED TO REVISION OR REASSESSMENT. IN SUCH CIRCUMSTANCES OF THE CASE, THE LD. AO AS WELL AS THE LD. CIT(A) WAS WHOLLY UNJUSTIFIED IN TAKING A CONTRARY VIEW IN THIS CASE. THIS BENCH OF THE TRIBUNAL IN THE CASE OF ITO VS. MALAY K MITTER IN ITA NO. 307/KOL/2012 WHEREIN ON SIMILAR FACTS THE CASE WAS DECIDED IN OWNER OF THE LANDED PROPERTY. IN THIS CASE THE TRIBUNAL HELD AND 5. AT THE OUTSET, LD. COUNSEL FOR THE ASSESSEE SUBMITTED THAT THE ISS UE IS SQUARELY COVERED IN FAVOUR OF THE ASSESSEE. HE REFERRED TO THE TRIBUNALS DECISION IN THE OWNER OF THE PROPERTY SHRI ARIJIT MITRA AS ABOVE AND CONTENDED THAT IN VIEW OF THE AFORESAID TRIBUNAL DECISION, NO CAPITAL GAIN WAS ELIGIBLE IN THE 6. LD. D.R. COULD NOT CONTRADICT TO THIS SUBMISSION OF THE LD. COUNSEL OF ASSESSEE. 7. WE HAVE HEARD THE RIVAL SUBMISSIONS AND PERUSED THE MATERIAL AVAILABLE ON RECORD. WE FIND THAT THIS ISSUE IS SQUARELY COVERED IN FAVOUR OF THE ASSESSEE TRIBUNAL IN THE HANDS OF THE CO - OWNER OF THE PROPERTY HAD HELD THAT THE LANDS IN QUESTION DID NOT CONSTITUTE CAPITAL ASSET UNDER SECTION 2(14) OF THE INCOME TAX ACT BECAUSE RAJARHAT MUNICIPALITY WAS NOT ONE OF THE NOTIFIED MUNICIPALITY AS ENTRAL GOVERNMENTS NOTIFICATION DATED 28.12.1999. HENCE, RESPECTFULLY FOLLOWING THE PRECEDENT, WE HOLD THAT THE LAND IN QUESTION, WHICH WAS TRANSFERRED BY THE ASSESSEE, WAS AN AGRICULTURAL LAND AND IT DID NOT FALL WITHIN THE AMBIT OF CAPITAL ASSET UNDER SECTION 2(14) OF THE INCOME ACCORDINGLY WE CONFIRM THE ORDER OF LD. CIT(APPEALS). THE LD. COUNSEL OF THE ASSESSEE SUBMITTED THAT THE LAND PURCHASED BY THE FIRM WAS REGISTERED AS AGRICULTURAL LAND IN THE REVENUE RECORDS AT THE TIME OF PURCHASE AND CONTINUED TO BE SAME WHEN THE LAND WAS SOLD. THE LAND WAS SITUATED IN AN AREA WHICH IS BEYOND 8 KILOMETRES FROM ANY MUNICIPALITY AND /OR CANTONMENT BOARD. THUS THE SAID LAND WAS NOT A CAPITAL ASSET WITHIN THE MEANING OF SECTION 2(14) OF THE ACT. THE CONVERSION OF LAND FROM AGRICULTURAL TO INDUSTRIAL SUBSEQUENTLY BY THE BUYER OF THE LAND WILL NOT HAVE ANY ADVERSE EFFECT ON ITS CHARGEABIL ITY OR OTHERWISE IN THE CASE OF THE I.T.A. NO. 981/KOL/2018 ASSESSMENT YEAR: 2011-12 SANJEEV KUMAR GOYAL OF CAPITAL GAINS DID NOT ARISE. TO VERIFY THE CONTENTIONS OF THE ASSESSEE, THE INCOME ERTY WAS AN AGRICULTURAL LAND WHICH WAS BEYOND THE RADIUS OF EIGHT KILOMETRES FROM THE MUNICIPAL AREA. THE INCOME TAX OFFICER THEREUPON HELD THAT THE CAPITAL GAIN ON SALE OF THIS LAND IS NOT TAXABLE. CTED TO REVISION OR REASSESSMENT. IN SUCH CIRCUMSTANCES OF THE CASE, THE LD. AO AS WELL AS THE LD. CIT(A) WAS WHOLLY UNJUSTIFIED IN TAKING A CONTRARY VIEW IN THIS CASE. HE RELIED ON ITO VS. MALAY K UMAR WHEREIN ON SIMILAR FACTS THE CASE WAS DECIDED IN OWNER OF THE LANDED PROPERTY. IN THIS CASE THE TRIBUNAL HELD AND UE IS SQUARELY COVERED IN FAVOUR OF THE ASSESSEE. HE REFERRED TO THE TRIBUNALS DECISION IN THE OWNER OF THE PROPERTY SHRI ARIJIT MITRA AS ABOVE AND CONTENDED THAT IN VIEW OF THE AFORESAID TRIBUNAL DECISION, NO CAPITAL GAIN WAS ELIGIBLE IN THE 6. LD. D.R. COULD NOT CONTRADICT TO THIS SUBMISSION OF THE LD. COUNSEL OF ASSESSEE. 7. WE HAVE HEARD THE RIVAL SUBMISSIONS AND PERUSED THE MATERIAL AVAILABLE ON RECORD. WE FIND THAT THIS ISSUE IS SQUARELY COVERED IN FAVOUR OF THE ASSESSEE . THE OWNER OF THE PROPERTY HAD HELD THAT THE LANDS IN QUESTION DID NOT CONSTITUTE CAPITAL ASSET UNDER SECTION 2(14) OF THE INCOME TAX ACT BECAUSE RAJARHAT MUNICIPALITY WAS NOT ONE OF THE NOTIFIED MUNICIPALITY AS ENTRAL GOVERNMENTS NOTIFICATION DATED 28.12.1999. HENCE, RESPECTFULLY FOLLOWING THE PRECEDENT, WE HOLD THAT THE LAND IN QUESTION, WHICH WAS TRANSFERRED BY THE ASSESSEE, WAS AN AGRICULTURAL LAND AND IT DID NOT FALL WITHIN SECTION 2(14) OF THE INCOME TAX ACT. THAT THE LAND PURCHASED BY THE FIRM WAS REGISTERED AS AGRICULTURAL LAND IN THE REVENUE RECORDS AT THE TIME OF PURCHASE AND CONTINUED TO BE SAME WHEN THE LAND WAS SOLD. THE LAND WAS SITUATED IN AN AREA WHICH /OR CANTONMENT BOARD. THUS THE SAID LAND WAS NOT A CAPITAL ASSET WITHIN THE MEANING OF SECTION 2(14) OF THE ACT. THE CONVERSION OF LAND FROM AGRICULTURAL TO INDUSTRIAL SUBSEQUENTLY BY THE BUYER OF THE LAND ITY OR OTHERWISE IN THE CASE OF THE SELLER OF SUCH LAND. THE AREA WAS NOT NOTIFIED FOR URBANISATION IN THE LATEST NOTIFICATION NO. 11186 DATED 28.12.1999 ISSUED BY THE CENTRAL GOVERNMENT. THEREFORE THE GAIN ARISING ON SALE OF THE SAME CANNOT BE CHARGED TO LAW FOR THIS PROPOSITION, WHICH WE WOULD BE REFERRING TO AS AND WHEN REQUIRED. 6.2. ON GROUND NOS. 5 & 6, THE LD. COUNSEL FOR THE ASSESSEE SUBMITTED THAT THE ASSESSEE HAS CHALLENGED THE ORDER OF LD. CIT(A) WHEREIN H SECTION 50C ARE APPLICABLE SINCE THE LAND SOLD BY THE ASSESSEE WAS NOT AN AGRICULTURAL LAND. HE SUBMITTED THAT THE LD. CIT(A) WAS NOT JUSTIFIED IN CONFIRMING THE ACTION OF AO WHEN THE ASSESSEE SOLD 50C OF THE ACT EVEN WHEN THE AO DID NOT REFER THE VALUATION TO DVO. THE THE ASSESSEE RELIED ON THE TO THE JUDGEMENT OF HONBLE CALCUTTA HIGH COURT IN THE CASE OF SUNIL AGARWAL VS. CIT IN ITAT NO. 221 OF HONBLE HIGH COURT HELD THAT FOR THE AFORESAID REASONS, WE ARE OF THE OPINION THAT THE VALUATION BY THE DEPARTMENTAL VALUATION OFFICER, CONTEMPLATED UNDER SECTION 50C, IS REQUIRED TO AVOID MISCARRIAGE OF JUSTICE. THE SHOULD BE FIXED MERELY ON THE BASIS OF THE VALUATION TO BE MADE BY THE DISTRICT SUB REGISTRAR FOR THE PURPOSE OF STAMP DUTY. THE LEGISLATURE HAS TAKEN CARE TO PROVIDE ADEQUATE MACHINERY TO GIVE A FAIR TREATM REASON WHY THE MACHINERY PROVIDED BY THE LEGISLATURE SHOULD NOT BE USED AND THE BENEFIT THEREOF SHOULD BE REFUSED. EVEN IN A CASE WHERE NO SUCH PRAYER IS MADE BY THE LEARNED ADVOCATE REPRESENTING THE ASSESSEE, WHO M INSTRUCTED IN LAW, THE ASSESSING OFFICER, DISCHARGING A QUASI BOUNDEN DUTY TO ACT FAIRLY AND TO GIVE A FAIR TREATMENT BY GIVING HIM AN OPTION TO FOLLOW THE COURSE PROVIDED BY LAW. 6.3. ON GROUND NO. 7, THE LD. COUNSEL FOR THE ASSESSEE SUBMITTED THAT THE ISSUED BY LD. CIT(A) TO THE FIRM M/S. SHREE ANNAPURNA OIL MILLS, TO BRING TO TAX THE PARTNERSHIP FIRM IS WITHOUT JU LD. CIT(A) HAS NO SUCH POWERS TO ISSUE SUCH DIRECTIONS. OF THE CIT(A) IS PRESCRIBED IN SECTION 251 OF THE ACT CIT(A) TO CONFIRM , REDUCE, ENHANCE OR ANNUL THE ASSESSMENT EMPOWERED TO ISSUE DIRECTIONS WHICH DO NOT GERMANE FROM THE APPEAL BEFORE HIM. ARGUED THAT THE LD. CIT(A) EXCEEDED HIS JURISDICTION INITIATE 147 PROCEEDINGS IN THE CASE OF THE PARTNERSHIP FIRM WHO WA HIM. HE SUBMITTED THAT THE ACTION TAKEN BY LD. AO IN PURSUANCE TO THE IMPUGNED 11 SELLER OF SUCH LAND. THE AREA WAS NOT NOTIFIED FOR URBANISATION IN THE LATEST NOTIFICATION NO. 11186 DATED 28.12.1999 ISSUED BY THE CENTRAL GOVERNMENT. THEREFORE THE GAIN ARISING ON SALE OF THE SAME CANNOT BE CHARGED TO CAPITAL GAINS. HE RELIED ON CERTAIN CASE LAW FOR THIS PROPOSITION, WHICH WE WOULD BE REFERRING TO AS AND WHEN REQUIRED. ON GROUND NOS. 5 & 6, THE LD. COUNSEL FOR THE ASSESSEE SUBMITTED THAT THE HAS CHALLENGED THE ORDER OF LD. CIT(A) WHEREIN H E HELD THAT THE PROVISIONS OF SECTION 50C ARE APPLICABLE SINCE THE LAND SOLD BY THE ASSESSEE WAS NOT AN AGRICULTURAL THAT THE LD. CIT(A) WAS NOT JUSTIFIED IN CONFIRMING THE ACTION OF AGRICULTURAL LAND AND C ONFIRMING THE APPLICATION OF SECTION WHEN THE AO DID NOT REFER THE VALUATION TO DVO. THE TO THE JUDGEMENT OF HONBLE CALCUTTA HIGH COURT IN THE CASE OF SUNIL AGARWAL VS. CIT IN ITAT NO. 221 OF 2013 AND GA NO. 3686 OF 2013 WHEREIN HONBLE HIGH COURT HELD THAT FOR THE AFORESAID REASONS, WE ARE OF THE OPINION THAT THE VALUATION BY THE DEPARTMENTAL VALUATION OFFICER, CONTEMPLATED UNDER SECTION 50C, IS REQUIRED TO AVOID MISCARRIAGE OF JUSTICE. THE LEGISLATURE DID NOT INTEND THAT THE CAPITAL GAIN SHOULD BE FIXED MERELY ON THE BASIS OF THE VALUATION TO BE MADE BY THE DISTRICT SUB REGISTRAR FOR THE PURPOSE OF STAMP DUTY. THE LEGISLATURE HAS TAKEN CARE TO PROVIDE ADEQUATE MACHINERY TO GIVE A FAIR TREATM ENT TO THE CITIZEN/TAXPAYER. THERE IS NO REASON WHY THE MACHINERY PROVIDED BY THE LEGISLATURE SHOULD NOT BE USED AND THE BENEFIT THEREOF SHOULD BE REFUSED. EVEN IN A CASE WHERE NO SUCH PRAYER IS MADE BY THE LEARNED ADVOCATE REPRESENTING THE ASSESSEE, WHO M AY NOT HAVE BEEN PROPERLY INSTRUCTED IN LAW, THE ASSESSING OFFICER, DISCHARGING A QUASI - JUDICIAL FUNCTION, HAS THE BOUNDEN DUTY TO ACT FAIRLY AND TO GIVE A FAIR TREATMENT BY GIVING HIM AN OPTION TO FOLLOW THE COURSE PROVIDED BY LAW. THE LD. COUNSEL FOR THE ASSESSEE SUBMITTED THAT THE THE ASSESSING OFFICER, TO RE- OPEN THE CASE OF THE PARTNERSHIP M/S. SHREE ANNAPURNA OIL MILLS, TO BRING TO TAX THE CAPITAL GAINS IN THE HANDS OF WITHOUT JU RISDICTION, ILLEGAL AND INVALID. HE SUBMITTED THAT LD. CIT(A) HAS NO SUCH POWERS TO ISSUE SUCH DIRECTIONS. HE SUBMITTED THAT T OF THE CIT(A) IS PRESCRIBED IN SECTION 251 OF THE ACT AND THE SECTION , REDUCE, ENHANCE OR ANNUL THE ASSESSMENT AND THAT HE EMPOWERED TO ISSUE DIRECTIONS WHICH DO NOT GERMANE FROM THE APPEAL BEFORE HIM. THE LD. CIT(A) EXCEEDED HIS JURISDICTION BY ISSUING DIRECTIONS TO THE AO TO INITIATE 147 PROCEEDINGS IN THE CASE OF THE PARTNERSHIP FIRM WHO WA S NOT A PARTY BEFORE THE ACTION TAKEN BY LD. AO IN PURSUANCE TO THE IMPUGNED I.T.A. NO. 981/KOL/2018 ASSESSMENT YEAR: 2011-12 SANJEEV KUMAR GOYAL SELLER OF SUCH LAND. THE AREA WAS NOT NOTIFIED FOR URBANISATION IN THE LATEST NOTIFICATION NO. 11186 DATED 28.12.1999 ISSUED BY THE CENTRAL GOVERNMENT. THEREFORE THE GAIN HE RELIED ON CERTAIN CASE - LAW FOR THIS PROPOSITION, WHICH WE WOULD BE REFERRING TO AS AND WHEN REQUIRED. ON GROUND NOS. 5 & 6, THE LD. COUNSEL FOR THE ASSESSEE SUBMITTED THAT THE E HELD THAT THE PROVISIONS OF SECTION 50C ARE APPLICABLE SINCE THE LAND SOLD BY THE ASSESSEE WAS NOT AN AGRICULTURAL THAT THE LD. CIT(A) WAS NOT JUSTIFIED IN CONFIRMING THE ACTION OF THE ONFIRMING THE APPLICATION OF SECTION WHEN THE AO DID NOT REFER THE VALUATION TO DVO. THE LD. COUNSEL FOR TO THE JUDGEMENT OF HONBLE CALCUTTA HIGH COURT IN THE CASE 2013 AND GA NO. 3686 OF 2013 WHEREIN FOR THE AFORESAID REASONS, WE ARE OF THE OPINION THAT THE VALUATION BY THE DEPARTMENTAL VALUATION OFFICER, CONTEMPLATED UNDER SECTION 50C, IS REQUIRED TO LEGISLATURE DID NOT INTEND THAT THE CAPITAL GAIN SHOULD BE FIXED MERELY ON THE BASIS OF THE VALUATION TO BE MADE BY THE DISTRICT SUB REGISTRAR FOR THE PURPOSE OF STAMP DUTY. THE LEGISLATURE HAS TAKEN CARE TO PROVIDE ENT TO THE CITIZEN/TAXPAYER. THERE IS NO REASON WHY THE MACHINERY PROVIDED BY THE LEGISLATURE SHOULD NOT BE USED AND THE BENEFIT THEREOF SHOULD BE REFUSED. EVEN IN A CASE WHERE NO SUCH PRAYER IS MADE BY AY NOT HAVE BEEN PROPERLY JUDICIAL FUNCTION, HAS THE BOUNDEN DUTY TO ACT FAIRLY AND TO GIVE A FAIR TREATMENT BY GIVING HIM AN OPTION TO THE LD. COUNSEL FOR THE ASSESSEE SUBMITTED THAT THE DIRECTIONS OPEN THE CASE OF THE PARTNERSHIP THE CAPITAL GAINS IN THE HANDS OF RISDICTION, ILLEGAL AND INVALID. HE SUBMITTED THAT THE HE SUBMITTED THAT T HE POWERS AND THE SECTION AUTHORISES THE AND THAT HE IS NOT EMPOWERED TO ISSUE DIRECTIONS WHICH DO NOT GERMANE FROM THE APPEAL BEFORE HIM. HE DIRECTIONS TO THE AO TO S NOT A PARTY BEFORE THE ACTION TAKEN BY LD. AO IN PURSUANCE TO THE IMPUGNED DIRECTIONS CONTAINED IN THE ORDER PASSED BY LD. CIT(A) BE DIRECT AB INITIO . 7. THE LD. D/R, CONTROVERTED THE SUBMISSIONS OF THE ASSESSEE AND ORDER OF THE ASSESSING OFFICER AS WELL AS THE LD. CIT(A) AND QUESTION IS NOT AGRICULTURAL LAND. HE REFERRED TO THE FACTS NARRATED THEREIN, THE ENQUIRIES MADE BY THE ASSESSING OFFICER AND THE THE SALE DEEDS, WHICH WAS BROUGHT OUT BY THE ASSESSING OFFICER IN HIS ASSESSMENT ORDER HE ARGUED THAT THE LAND IN QUESTION WAS NEV PURCHASED WITH AN INTENTION FOR BEING USED FOR AGRICULTURAL PURPOSES. HE POINTED OUT THAT ALL THE SURROUNDING AREAS WERE INDUSTRIAL PLOTS AND THE ASSESSEES LAND EVEN HAD AN INDUSTRIAL SHED. HE TOOK THIS BENCH THR LD. CIT(A) AND PRAYED THAT HE ORDER OF THE ASSESSING OFFICER BE UPHELD. THE LD. D/R FURTHER SUBMITTED THAT THE ASSESSEE SHOULD NOT HAVE ANY GRIEVANCE IN THIS CASE, AS THE LD. CIT(A) HAS DELETED THE ADDITION I GIVEN TO THE ASSESSING OFFICER, HE SUBMITTED THAT SUCH DIRECTIONS CAN BE GIVEN AND IT IS FOR THE ASSESSING OFFICER TO TAKEN GUIDANCE FROM THE SAME AND THAT THESE DIRECTIONS THE LD. CIT(A) ISSUED TO THE AS 8. WE HAVE HEARD RIVAL CONTENTIONS. ON CAREFUL CONSIDERATION OF THE FACTS AND CIRCUMSTANCES OF THE CASE, PERUSAL OF THE PAPERS ON RECORD, ORDERS OF THE AUTHORITIES BELOW AS WELL AS CASE LAW CITED, WE HOLD AS FOLLOWS: 9. G ROUND NO. 1 TO 4 ARE ON THE ISSUE AS TO WHETHER THE LAND IN QUESTION IS AGRICULTURAL LAND OR NOT. SEVERAL PROPOSITIONS SUPPORTED BY CASE-LAW. THESE ARE AS FOLLOWS: PROPOSITION 1:- THE ASSESSEE CLAIMS THAT HE LAND IN QUESTION IS SITUATED BEYOND 8 KMS. OF THE LOCAL LIMITS FROM THE MUNICIPALITY AND HENCE CANNOT BE HELD AS A CAPITAL ASSET WHEN THE LAND WAS RECORDED AS AGRICULTURAL LAND IN THE REVENUE RECORDS AT ALL TIMES BEFORE THE SALE OF SUCH LAND. FOR THIS PROPOSITION, HE RELIED ON THE FOLLOWING CASE LAW:- (I) KHAITAN LEFIN LIMITED VS. CIT IDENTICAL TO THE ISSUE IN THE INSTANT APPEAL. HONBLE KOLKATA TRIBUNAL IN PARA HELD AND OBSERVED AS UNDER: 12 DIRECTIONS CONTAINED IN THE ORDER PASSED BY LD. CIT(A) BE DIRECT ED TO BE ILLEGAL AND VOID CONTROVERTED THE SUBMISSIONS OF THE ASSESSEE AND ORDER OF THE ASSESSING OFFICER AS WELL AS THE LD. CIT(A) AND ARGU ED THAT THE LAND IN QUESTION IS NOT AGRICULTURAL LAND. HE REFERRED TO THE REPORT OF THE INSPECTOR DEPUTED, ENQUIRIES MADE BY THE ASSESSING OFFICER AND THE THE SALE DEEDS, WHICH WAS BROUGHT OUT BY THE ASSESSING OFFICER IN HIS ASSESSMENT ORDER ARGUED THAT THE LAND IN QUESTION WAS NEV ER USED FOR AGRICULTURAL PURPOSES, NOR WAS PURCHASED WITH AN INTENTION FOR BEING USED FOR AGRICULTURAL PURPOSES. HE POINTED OUT THAT ALL THE SURROUNDING AREAS WERE INDUSTRIAL PLOTS AND THE ASSESSEES LAND EVEN HAD AN HE TOOK THIS BENCH THR OUGH THE ORDER OF THE ASSESSING OFFICER AND THE PRAYED THAT HE ORDER OF THE ASSESSING OFFICER BE UPHELD. THE LD. D/R FURTHER SUBMITTED THAT THE ASSESSEE SHOULD NOT HAVE ANY GRIEVANCE IN THIS CASE, AS THE ADDITION I N HIS HANDS. ON THE DIRECTIONS OF THE LD. CIT(A) GIVEN TO THE ASSESSING OFFICER, HE SUBMITTED THAT SUCH DIRECTIONS CAN BE GIVEN AND IT IS FOR THE ASSESSING OFFICER TO TAKEN GUIDANCE FROM THE SAME AND THAT THESE DIRECTIONS THE LD. CIT(A) ISSUED TO THE AS SESSING OFFICER, ARE NOT BINDING. WE HAVE HEARD RIVAL CONTENTIONS. ON CAREFUL CONSIDERATION OF THE FACTS AND CIRCUMSTANCES OF THE CASE, PERUSAL OF THE PAPERS ON RECORD, ORDERS OF THE AUTHORITIES BELOW AS WELL AS CASE LAW CITED, WE HOLD AS FOLLOWS: - ROUND NO. 1 TO 4 ARE ON THE ISSUE AS TO WHETHER THE LAND IN QUESTION IS AGRICULTURAL LAND OR NOT. SEVERAL PROPOSITIONS OF LAW WERE CITED AND THESE WERE THESE ARE AS FOLLOWS: - THE ASSESSEE CLAIMS THAT HE LAND IN QUESTION IS SITUATED BEYOND 8 KMS. OF THE LOCAL LIMITS FROM THE MUNICIPALITY AND HENCE CANNOT BE HELD AS A CAPITAL ASSET WHEN THE LAND WAS RECORDED AS AGRICULTURAL LAND IN THE REVENUE BEFORE THE SALE OF SUCH LAND. FOR THIS PROPOSITION, HE RELIED ON KHAITAN LEFIN LIMITED VS. CIT ITA NO. 200/KOL/2016 THE ISSUE IN THIS CASE IS IDENTICAL TO THE ISSUE IN THE INSTANT APPEAL. HONBLE KOLKATA TRIBUNAL IN PARA 4 OF ITS ORDER HELD AND OBSERVED AS UNDER: I.T.A. NO. 981/KOL/2018 ASSESSMENT YEAR: 2011-12 SANJEEV KUMAR GOYAL ED TO BE ILLEGAL AND VOID CONTROVERTED THE SUBMISSIONS OF THE ASSESSEE AND RELIED ON THE ED THAT THE LAND IN REPORT OF THE INSPECTOR DEPUTED, THE ENQUIRIES MADE BY THE ASSESSING OFFICER AND THE RECITALS IN THE SALE DEEDS, WHICH WAS BROUGHT OUT BY THE ASSESSING OFFICER IN HIS ASSESSMENT ORDER . ER USED FOR AGRICULTURAL PURPOSES, NOR WAS PURCHASED WITH AN INTENTION FOR BEING USED FOR AGRICULTURAL PURPOSES. HE POINTED OUT THAT ALL THE SURROUNDING AREAS WERE INDUSTRIAL PLOTS AND THE ASSESSEES LAND EVEN HAD AN OUGH THE ORDER OF THE ASSESSING OFFICER AND THE PRAYED THAT HE ORDER OF THE ASSESSING OFFICER BE UPHELD. THE LD. D/R FURTHER SUBMITTED THAT THE ASSESSEE SHOULD NOT HAVE ANY GRIEVANCE IN THIS CASE, AS THE N HIS HANDS. ON THE DIRECTIONS OF THE LD. CIT(A) GIVEN TO THE ASSESSING OFFICER, HE SUBMITTED THAT SUCH DIRECTIONS CAN BE GIVEN AND IT IS FOR THE ASSESSING OFFICER TO TAKEN GUIDANCE FROM THE SAME AND THAT THESE DIRECTIONS OF WE HAVE HEARD RIVAL CONTENTIONS. ON CAREFUL CONSIDERATION OF THE FACTS AND CIRCUMSTANCES OF THE CASE, PERUSAL OF THE PAPERS ON RECORD, ORDERS OF THE AUTHORITIES ROUND NO. 1 TO 4 ARE ON THE ISSUE AS TO WHETHER THE LAND IN QUESTION IS OF LAW WERE CITED AND THESE WERE THE ASSESSEE CLAIMS THAT HE LAND IN QUESTION IS SITUATED BEYOND 8 KMS. OF THE LOCAL LIMITS FROM THE MUNICIPALITY AND HENCE CANNOT BE HELD AS A CAPITAL ASSET WHEN THE LAND WAS RECORDED AS AGRICULTURAL LAND IN THE REVENUE BEFORE THE SALE OF SUCH LAND. FOR THIS PROPOSITION, HE RELIED ON THE ISSUE IN THIS CASE IS 4 OF ITS ORDER 4. THERE IS NO DISPUTE THAT THE ASSESSEE HAD INDEED SOLD ITS LAND IN QUESTION MEASURING 5.33 ACRES SITUATED IN VILLAGE MAMIDIPALLY MANDAL SAROONAGAR DISTRICT RANGA REDDY IN ERSTWHILE ANDHRA PRADESH DURING THE REL SOLE DISPUTE IN THE INSTANT LIS THAT ARISES FOR OUR APT ADJUDICATION IS AS TO WHETHER THE ASSESSEES LAND SOLD WAS A CAPITAL ASSET OR NOT FALLING WITHIN 8 KMS. OF THE GHMC U/S 2(14)(III)(B) OF THE ACT AS APPLICABLE IN THE IMPUGNE YEAR. THE TAXPAYER STAND THROUGHOUT IS THAT ITS LAND IS NOT A CAPITAL ASSET SINCE IT IS SITUATED BEYOND 8 KMS. DISTANCE OF ANY MUNICIPALITY WHEREAS THE REVENUES CASE IS THAT MAMIDIPALLY GRAM PANCHAYAT IS ADJACENT TO THE GHMC LIMITS. AND ALSO THAT IS HAPPENS TO BE A HUB OF MAJOR ECONOMIC ACTIVITY INCLUDING AVIATION SECTOR. WE FIND NO MERIT IN THE LATTERS STAND BASED ON THE LOWER AUTHORITYS RESPECTIVE FINDINGS. WE MAKE IT CLEAR FIRST OF ALL THAT THERE IS NO REBUTTAL COMING FROM THE DEPARTMENT T AGRICULTURAL TO NON QUESTION. THE STATE GOVERNMENTS REVENUE RECORDS STRONGLY SUPPORT THE ASSESSEES CASE RATHER THAT ITS LANDS ARE VERY MUCH AGR THE ASSESSING OFFICER TRIED TO APPLY PERFORMANCE TEST THAT FOR DETERMINATION OF LAND IN ISSUE WHAT IS REQUIRED TO BE SHOWN IS CONNECTION WITH THE AGRICULTURAL PURPOSE IS THE USE AND NOT THE MERE POSSIBILITY OF THE LAND USER BY SOME P MERIT IN THE IMPUGNED REASONING. AGRICULTURAL LANDS BEYOND 8 KMS. FROM THE LOCAL MUNICIPALITY ETC.; AS THE CENTRAL GOVERNMENT MAY, HAVING REGARD TO THE EXTENT/SCOP CONSIDERATION, SPECIFICALLY IN THE BEHALF..... (II) NAIYER SULTAN V. ITO 7. WE HAVE CONSIDERED THE RIVAL SUBMISSIONS ON THIS ISSUE AND ALSO PERUSED THE RELEVANT MATERIAL AVAILABLE ON RECORD. OWNED JOINTLY BY BOTH THE ASSESSEES IN THE PRESENT CASE WAS SOLD AND THE GAIN ARISING FROM THE SAI LAND BEING AN AGRICULTURAL LAND WAS NOT A CAPITAL ASSET WITHIN THE MEANING OF SECTION 2(14). AS DEFINED IN SECTION 2(14), 'CAPITAL ASSET' MEANS PROPERTY OF ANY KIND HELD BY AN ASSESSEE, WHETHER OR PROFESSION, BUT DOES NOT INCLUDE, INTER ALIA, AS PER CLAUSE (III) AGRICULTURAL LAND IN INDIA NOT BEING LAND SITUATED IN ANY AREA WITHIN THE DISTANCE, MEASURED AERIALLY, NOT BEING MORE THAN 8 KMS. FROM THE LOCAL LIMITS OF CANTONMENT BOARD WHICH HAS A POPULATION OF MORE THAN 10 LAKHS. IN SUPPORT OF THIS CLAIM, A CERTIFICATE ISSUED BY THE CONCERNED TEHSILDAR OF TIRUPPORUR WAS SUBMITTED BY THE ASSESSEES SHOWING THAT THE LAND SOLD BY THEM WAS LOCATED 20 KM. AWAY FROM THE LIMIT OF CHENNAI MUNICIPAL CORPORATION. BASED ON THIS CERTIFICATE AS WELL AS THE PROVISIONS OF SECTION 2(14)(III), THE CLAIM OF THE ASSESSEES FOR EXEMPTION WAS ALLOWED BY THE ASSESSING OFFICER IN THE ASSESSMENTS ORIGINALLY COMPLETED UNDER SE SUBSEQUENTLY REOPENED BY HIM AFTER RECORDING THE REASONS AND A PERUSAL OF THE REASONS SO RECORDED BY THE ASSESSING OFFICER, WHICH ARE REPRODUCED IN THE FOREGOING PORTION OF THIS ORDER, SHOWS THAT THE ASSESSEES INCOME FROM ASSESSMENTS WAS FORMED BY THE ASSESSING OFFICER ON THE BASIS OF INFORMATION RECEIVED IN THE FORM OF A COMMUNICATION FROM DDIT(INV.), CHENNAI, WHICH STATED THAT THE AREA OF CHENNAI METROPOLITAN REGION WA LARGER THAN WHAT WAS STATED BY THE TEHSILDAR IN HIS REPORT AND THE LAND SOLD BY THE ASSESSEES WAS SITUATED AT ABOUT 3 KMS. FROM THE CHENNAI METROPOLITAN AREA. ON THE BASIS OF THE SAID INFORMATION, THE ASSESSING OFFICER ENTERTAINED A BELIEF THAT THE GAIN ARISING FROM THE SALE OF THE SAID LAND WAS CHARGEABLE TO TAX AND THE INCOME OF THE ASSESSEES IN THE FORM OF CAPITAL GAINS HAD ESCAPED ASSESSMENT. RIGHTLY CONTENDED BY THE LD. COUNSEL FOR THE ASSESSEES IN THIS REGARD, THE LOCATION OF THE LAND FROM T WAS RELEVANT TO DECIDE AS TO WHETHER THE SAID LAND WAS AN AGRICULTURAL LAND 13 4. THERE IS NO DISPUTE THAT THE ASSESSEE HAD INDEED SOLD ITS LAND IN QUESTION MEASURING 5.33 ACRES SITUATED IN VILLAGE MAMIDIPALLY MANDAL SAROONAGAR DISTRICT RANGA REDDY IN ERSTWHILE ANDHRA PRADESH DURING THE REL EVANT PREVIOUS YEAR; THE SOLE DISPUTE IN THE INSTANT LIS THAT ARISES FOR OUR APT ADJUDICATION IS AS TO WHETHER THE ASSESSEES LAND SOLD WAS A CAPITAL ASSET OR NOT FALLING WITHIN 8 KMS. OF THE GHMC U/S 2(14)(III)(B) OF THE ACT AS APPLICABLE IN THE IMPUGNE D ASSESSMENT YEAR. THE TAXPAYER STAND THROUGHOUT IS THAT ITS LAND IS NOT A CAPITAL ASSET SINCE IT IS SITUATED BEYOND 8 KMS. DISTANCE OF ANY MUNICIPALITY WHEREAS THE REVENUES CASE IS THAT MAMIDIPALLY GRAM PANCHAYAT IS ADJACENT TO THE GHMC LIMITS. AND ALSO THAT IS HAPPENS TO BE A HUB OF MAJOR ECONOMIC ACTIVITY INCLUDING AVIATION SECTOR. WE FIND NO MERIT IN THE LATTERS STAND BASED ON THE LOWER AUTHORITYS RESPECTIVE WE MAKE IT CLEAR FIRST OF ALL THAT THERE IS NO REBUTTAL COMING FROM THE DEPARTMENT T HAT THE LAND IN QUESTION HAS EVER BEEN CONVERTED FROM AGRICULTURAL TO NON - AGRICULTURAL USE AT ANY POINT OF TIME BEFORE THE SALE IN QUESTION. THE STATE GOVERNMENTS REVENUE RECORDS STRONGLY SUPPORT THE ASSESSEES CASE RATHER THAT ITS LANDS ARE VERY MUCH AGR ICULTURAL IN NATURE. THE ASSESSING OFFICER TRIED TO APPLY PERFORMANCE TEST THAT FOR DETERMINATION OF LAND IN ISSUE WHAT IS REQUIRED TO BE SHOWN IS CONNECTION WITH THE AGRICULTURAL PURPOSE IS THE USE AND NOT THE MERE POSSIBILITY OF THE LAND USER BY SOME P OSSIBLE FUTURE OWNER FOR AGRICULTURAL OBJECTS. WE SEE NO MERIT IN THE IMPUGNED REASONING. THE LEGISLATURE MAKES IT CLEAR THAT AGRICULTURAL LANDS BEYOND 8 KMS. FROM THE LOCAL MUNICIPALITY ETC.; AS THE CENTRAL GOVERNMENT MAY, HAVING REGARD TO THE EXTENT/SCOP E FOR URBANISATION AND OTHER CONSIDERATION, SPECIFICALLY IN THE BEHALF..... NAIYER SULTAN V. ITO [2019] 106 TAXMANN.COM 191 (KOL ITAT) WE HAVE CONSIDERED THE RIVAL SUBMISSIONS ON THIS ISSUE AND ALSO PERUSED THE RELEVANT MATERIAL AVAILABLE ON RECORD. DURING THE YEAR UNDER CONSIDERATION, LAND OWNED JOINTLY BY BOTH THE ASSESSEES IN THE PRESENT CASE WAS SOLD AND THE GAIN ARISING FROM THE SAI D LAND WAS CLAIMED TO BE EXEMPT ON THE GROUND THAT THE SAID LAND BEING AN AGRICULTURAL LAND WAS NOT A CAPITAL ASSET WITHIN THE MEANING OF SECTION 2(14). AS DEFINED IN SECTION 2(14), 'CAPITAL ASSET' MEANS PROPERTY OF ANY KIND HELD BY AN ASSESSEE, WHETHER OR NOT CONNECTED WITH HIS BUSINESS OR PROFESSION, BUT DOES NOT INCLUDE, INTER ALIA, AS PER CLAUSE (III) AGRICULTURAL LAND IN INDIA NOT BEING LAND SITUATED IN ANY AREA WITHIN THE DISTANCE, MEASURED AERIALLY, NOT BEING MORE THAN 8 KMS. FROM THE LOCAL LIMITS OF ANY MUNICIPALITY OR CANTONMENT BOARD WHICH HAS A POPULATION OF MORE THAN 10 LAKHS. IN SUPPORT OF THIS CLAIM, A CERTIFICATE ISSUED BY THE CONCERNED TEHSILDAR OF TIRUPPORUR WAS SUBMITTED BY THE ASSESSEES SHOWING THAT THE LAND SOLD BY THEM WAS LOCATED 20 AWAY FROM THE LIMIT OF CHENNAI MUNICIPAL CORPORATION. BASED ON THIS CERTIFICATE AS WELL AS THE PROVISIONS OF SECTION 2(14)(III), THE CLAIM OF THE ASSESSEES FOR EXEMPTION WAS ALLOWED BY THE ASSESSING OFFICER IN THE ASSESSMENTS ORIGINALLY COMPLETED UNDER SE CTION 143(3)/143(1). THE SAID ASSESSMENTS, HOWEVER, WERE SUBSEQUENTLY REOPENED BY HIM AFTER RECORDING THE REASONS AND A PERUSAL OF THE REASONS SO RECORDED BY THE ASSESSING OFFICER, WHICH ARE REPRODUCED IN THE FOREGOING PORTION OF THIS ORDER, SHOWS THAT THE BELIEF ABOUT THE ESCAPEMENT OF ASSESSEES INCOME FROM ASSESSMENTS WAS FORMED BY THE ASSESSING OFFICER ON THE BASIS OF INFORMATION RECEIVED IN THE FORM OF A COMMUNICATION FROM DDIT(INV.), CHENNAI, WHICH STATED THAT THE AREA OF CHENNAI METROPOLITAN REGION WA LARGER THAN WHAT WAS STATED BY THE TEHSILDAR IN HIS REPORT AND THE LAND SOLD BY THE ASSESSEES WAS SITUATED AT ABOUT 3 KMS. FROM THE CHENNAI METROPOLITAN AREA. ON THE BASIS OF THE SAID INFORMATION, THE ASSESSING OFFICER ENTERTAINED A BELIEF THAT GAIN ARISING FROM THE SALE OF THE SAID LAND WAS CHARGEABLE TO TAX AND THE INCOME OF THE ASSESSEES IN THE FORM OF CAPITAL GAINS HAD ESCAPED ASSESSMENT. RIGHTLY CONTENDED BY THE LD. COUNSEL FOR THE ASSESSEES IN THIS REGARD, THE LOCATION OF THE LAND FROM T HE LOCAL LIMITS OF CHENNAI MUNICIPAL CORPORATION WAS RELEVANT TO DECIDE AS TO WHETHER THE SAID LAND WAS AN AGRICULTURAL LAND I.T.A. NO. 981/KOL/2018 ASSESSMENT YEAR: 2011-12 SANJEEV KUMAR GOYAL 4. THERE IS NO DISPUTE THAT THE ASSESSEE HAD INDEED SOLD ITS LAND IN QUESTION MEASURING 5.33 ACRES SITUATED IN VILLAGE MAMIDIPALLY MANDAL SAROONAGAR DISTRICT EVANT PREVIOUS YEAR; THE SOLE DISPUTE IN THE INSTANT LIS THAT ARISES FOR OUR APT ADJUDICATION IS AS TO WHETHER THE ASSESSEES LAND SOLD WAS A CAPITAL ASSET OR NOT FALLING WITHIN 8 KMS. OF THE D ASSESSMENT YEAR. THE TAXPAYER STAND THROUGHOUT IS THAT ITS LAND IS NOT A CAPITAL ASSET SINCE IT IS SITUATED BEYOND 8 KMS. DISTANCE OF ANY MUNICIPALITY WHEREAS THE REVENUES CASE IS THAT MAMIDIPALLY GRAM PANCHAYAT IS ADJACENT TO THE GHMC LIMITS. AND ALSO THAT IS HAPPENS TO BE A HUB OF MAJOR ECONOMIC ACTIVITY INCLUDING AVIATION SECTOR. WE FIND NO MERIT IN THE LATTERS STAND BASED ON THE LOWER AUTHORITYS RESPECTIVE WE MAKE IT CLEAR FIRST OF ALL THAT THERE IS NO REBUTTAL COMING FROM HAT THE LAND IN QUESTION HAS EVER BEEN CONVERTED FROM AGRICULTURAL USE AT ANY POINT OF TIME BEFORE THE SALE IN QUESTION. THE STATE GOVERNMENTS REVENUE RECORDS STRONGLY SUPPORT THE ICULTURAL IN NATURE. THE ASSESSING OFFICER TRIED TO APPLY PERFORMANCE TEST THAT FOR DETERMINATION OF LAND IN ISSUE WHAT IS REQUIRED TO BE SHOWN IS CONNECTION WITH THE AGRICULTURAL PURPOSE IS THE USE AND NOT THE MERE POSSIBILITY OF THE OSSIBLE FUTURE OWNER FOR AGRICULTURAL OBJECTS. WE SEE NO THE LEGISLATURE MAKES IT CLEAR THAT AGRICULTURAL LANDS BEYOND 8 KMS. FROM THE LOCAL MUNICIPALITY ETC.; AS THE CENTRAL E FOR URBANISATION AND OTHER WE HAVE CONSIDERED THE RIVAL SUBMISSIONS ON THIS ISSUE AND ALSO PERUSED THE DURING THE YEAR UNDER CONSIDERATION, LAND OWNED JOINTLY BY BOTH THE ASSESSEES IN THE PRESENT CASE WAS SOLD AND THE GAIN D LAND WAS CLAIMED TO BE EXEMPT ON THE GROUND THAT THE SAID LAND BEING AN AGRICULTURAL LAND WAS NOT A CAPITAL ASSET WITHIN THE MEANING OF SECTION 2(14). AS DEFINED IN SECTION 2(14), 'CAPITAL ASSET' MEANS PROPERTY OF ANY NOT CONNECTED WITH HIS BUSINESS OR PROFESSION, BUT DOES NOT INCLUDE, INTER ALIA, AS PER CLAUSE (III) AGRICULTURAL LAND IN INDIA NOT BEING LAND SITUATED IN ANY AREA WITHIN THE DISTANCE, MEASURED AERIALLY, ANY MUNICIPALITY OR CANTONMENT BOARD WHICH HAS A POPULATION OF MORE THAN 10 LAKHS. IN SUPPORT OF THIS CLAIM, A CERTIFICATE ISSUED BY THE CONCERNED TEHSILDAR OF TIRUPPORUR WAS SUBMITTED BY THE ASSESSEES SHOWING THAT THE LAND SOLD BY THEM WAS LOCATED 20 AWAY FROM THE LIMIT OF CHENNAI MUNICIPAL CORPORATION. BASED ON THIS CERTIFICATE AS WELL AS THE PROVISIONS OF SECTION 2(14)(III), THE CLAIM OF THE ASSESSEES FOR EXEMPTION WAS ALLOWED BY THE ASSESSING OFFICER IN THE ASSESSMENTS ORIGINALLY THE SAID ASSESSMENTS, HOWEVER, WERE SUBSEQUENTLY REOPENED BY HIM AFTER RECORDING THE REASONS AND A PERUSAL OF THE REASONS SO RECORDED BY THE ASSESSING OFFICER, WHICH ARE REPRODUCED IN THE BELIEF ABOUT THE ESCAPEMENT OF ASSESSEES INCOME FROM ASSESSMENTS WAS FORMED BY THE ASSESSING OFFICER ON THE BASIS OF INFORMATION RECEIVED IN THE FORM OF A COMMUNICATION FROM DDIT(INV.), CHENNAI, WHICH STATED THAT THE AREA OF CHENNAI METROPOLITAN REGION WA S MUCH LARGER THAN WHAT WAS STATED BY THE TEHSILDAR IN HIS REPORT AND THE LAND SOLD BY THE ASSESSEES WAS SITUATED AT ABOUT 3 KMS. FROM THE CHENNAI METROPOLITAN AREA. ON THE BASIS OF THE SAID INFORMATION, THE ASSESSING OFFICER ENTERTAINED A BELIEF THAT GAIN ARISING FROM THE SALE OF THE SAID LAND WAS CHARGEABLE TO TAX AND THE INCOME OF THE ASSESSEES IN THE FORM OF CAPITAL GAINS HAD ESCAPED ASSESSMENT. AS RIGHTLY CONTENDED BY THE LD. COUNSEL FOR THE ASSESSEES IN THIS REGARD, THE HE LOCAL LIMITS OF CHENNAI MUNICIPAL CORPORATION WAS RELEVANT TO DECIDE AS TO WHETHER THE SAID LAND WAS AN AGRICULTURAL LAND IN INDIA WITHIN THE MEANING OF CLAUSE (III) OF SUB AND THE DISTANCE OF THE LAND FROM THE CHENNAI METROPOL RELEVANT IN THIS CONTEXT. REGARDING THE LOCATION OF THE LAND BEING SITUATED AT ABOUT 3 KMS. FROM THE CHENNAI METROPOLITAN AREA THUS WAS VAGUE AND IRRELEVANT TO DECIDE THE ISSUE RELATING TO THE EXEMPTION CLAIMED BY THE ASSESSEES IN RESPECT OF GAIN FROM THE SALE OF THEIR LAND.. (III) PR. CIT VS. P. S. RAGHUPATHY THE ASSESSEE SOLD A PIECE OF LAND AND CLAIMED THAT THE LAND WAS AN AGRICULTURAL LAN RECORDED IN REVENUE RECORDS AND THE SAME WAS SITUATED BEYOND 8 K.M FROM THE NEAREST MUNICIPALITY. THE HONBLE MADRAS HIGH COURT HELD AND OBSERVED AS UNDER: 18. MR. T.R. SENTHIL KUMAR, ARRIVED AT HIS FINDING BASED ON THE FACT THAT THE LAND IN QUESTION HAD BEEN CLASSIFIED IN THE RECORDS OF THE SUB REGISTRAR OFFICE AS REVENUE LAND. HOWEVER, AS WOULD APPEAR FROM THE ORDER OF THE ASSESSMENT ITS AGRICULTURAL LAND IN THE REVENUE RECORDS. EVEN OTHERWISE, THE LEARNED TRIBUNAL HAD LOOKED INTO THE RELEVANT MATERIALS INCLUDING THE REVENUE RECORDS, AS ALSO RECORDS WHICH INDICATE THAT THE RESPONDENT ASSESSEE RAN A NURSERY. 19. TH E LEARNED TRIBUNAL WAS OF THE VIEW THAT WHETHER THERE WAS AGRICULTURAL INCOME OR NOT WAS NOT RELEVANT. NO FAULT CAN BE FOUND WITH THE REASONING OF THE LEARNED TRIBUNAL. THE FACT THAT THERE WAS LOSS AND NOT INCOME COULD NOT HAVE MADE ANY DIFFERENCE TO THE N THE SLP FILED BY REVENUE AGAINST THE AFORESAID JUDGEMENT OF HONBLE MADRAS HIGH COURT WAS DISMISSED BY HONBLE SUPREME COURT [2019] 102 TAXMANN.COM 223 (SC) (IV) M. VIJAYA V. DCIT 37. F URTHER, WE MAKE IT CLEAR THAT WHEN THE LAND WHICH DOES NOT FALL UNDER THE PROVISIONS OF SECTION 2(14)(III) OF THE IT ACT AND AN ASSESSEE WHO IS ENGAGED IN AGRICULTURAL OPERATIONS IN SUCH AGRICULTURAL LAND AND ALSO BEING SPECIFIED AS AGRICULTURAL LAND IN RE AS NON- AGRICULTURAL LAND BY THE ASSESSEE OR ANY OTHER CONCERNED PERSON, TRANSFERS SUCH AGRICULTURAL LAND AS IT IS AND WHERE IT IS BASIS, IN SUCH CIRCUMSTANCES, IN OUR OPINION, SUCH TRANSFER LIKE TH CAPITAL ASSET OR THE TRANSACTION RELATING TO SALE OF LAND WAS NOT AN ADVENTURE IN THE NATURE OF TRADE SO AS TO TAX THE INCOME ARISING OUT OF THIS TRANSACTION AS BUSINESS INCOME. (V) HARNIKS PARK (P.) LTD. VS. ITO THIS CASE THE FOLLOWING OBSERVATIONS OF THE HONBLE TRIBUNAL ARE RELEVANT TO THIS CASE. 48. ............. AND AS IN THE PRESENT CASE, ADMITTEDLY, THE AGRICULTURAL LAND OF THE ASSESSEE IS O AND THAT ALSO 8 KM AWAY FROM THE OUTER LIMITS OF THIS MUNICIPALITY, ASSESSEE'S LAND DOES NOT COME WITHIN THE PURVIEW OF SECTION 2(14)(III) EITHER UNDER SUB CLAUSE (A) OR (B) OF THE ACT, HENCE THE SAME C AS CAPITAL ASSET WITHIN THE MEANING OF THIS SECTION. CAN BE CHARGED ON THE SALE TRANSACTION OF THIS LAND ENTERED BY THE ASSESSEE. THIS IS SUPPORTED BY THE ORDER OF KOLKATA BENCH OF THIS TRIBUNAL IN THE CASE OF MITRA (CITED SUPRA), HARESH V. MILANI V. JT. CIT M.S. SRINIVASA NAICKER V. ITO BY BORROWING THE MEANING FROM THE ABOVE SECTION, WE ARE NOT ABLE TO APPRECIATE 14 IN INDIA WITHIN THE MEANING OF CLAUSE (III) OF SUB - SECTION (14) OF SECTION 2 AND THE DISTANCE OF THE LAND FROM THE CHENNAI METROPOL ITAN AREA WAS NOT RELEVANT IN THIS CONTEXT. THE INFORMATION RECEIVED BY THE ASSESSING OFFICER REGARDING THE LOCATION OF THE LAND BEING SITUATED AT ABOUT 3 KMS. FROM THE CHENNAI METROPOLITAN AREA THUS WAS VAGUE AND IRRELEVANT TO DECIDE THE ISSUE THE EXEMPTION CLAIMED BY THE ASSESSEES IN RESPECT OF GAIN FROM THE SALE PR. CIT VS. P. S. RAGHUPATHY [2018] 96 TAXMANN.COM 200 (MAD) THE ASSESSEE SOLD A PIECE OF LAND AND CLAIMED THAT THE LAND WAS AN AGRICULTURAL LAN RECORDED IN REVENUE RECORDS AND THE SAME WAS SITUATED BEYOND 8 K.M FROM THE NEAREST MUNICIPALITY. THE HONBLE MADRAS HIGH COURT HELD AND OBSERVED AS UNDER: MR. T.R. SENTHIL KUMAR, EMPHATICALLY ARGUED THAT THE ASSESSING OFFICER ARRIVED AT HIS FINDING BASED ON THE FACT THAT THE LAND IN QUESTION HAD BEEN CLASSIFIED IN THE RECORDS OF THE SUB REGISTRAR OFFICE AS REVENUE LAND. HOWEVER, AS WOULD APPEAR FROM THE ORDER OF THE ASSESSMENT ITS ELF, IT WAS CLASSIFIED AS AGRICULTURAL LAND IN THE REVENUE RECORDS. EVEN OTHERWISE, THE LEARNED TRIBUNAL HAD LOOKED INTO THE RELEVANT MATERIALS INCLUDING THE REVENUE RECORDS, AS ALSO RECORDS WHICH INDICATE THAT THE RESPONDENT ASSESSEE RAN A NURSERY. E LEARNED TRIBUNAL WAS OF THE VIEW THAT WHETHER THERE WAS AGRICULTURAL INCOME OR NOT WAS NOT RELEVANT. NO FAULT CAN BE FOUND WITH THE REASONING OF THE LEARNED TRIBUNAL. THE FACT THAT THERE WAS LOSS AND NOT INCOME COULD NOT HAVE MADE ANY DIFFERENCE TO THE N ATURE AND CHARACTER OF THE LAND. THE SLP FILED BY REVENUE AGAINST THE AFORESAID JUDGEMENT OF HONBLE MADRAS HIGH COURT WAS DISMISSED BY HONBLE SUPREME COURT [2019] 102 TAXMANN.COM M. VIJAYA V. DCIT [2014] 49 TAXMANN.COM 26 (HYD-ITAT) URTHER, WE MAKE IT CLEAR THAT WHEN THE LAND WHICH DOES NOT FALL UNDER THE PROVISIONS OF SECTION 2(14)(III) OF THE IT ACT AND AN ASSESSEE WHO IS ENGAGED IN AGRICULTURAL OPERATIONS IN SUCH AGRICULTURAL LAND AND ALSO BEING SPECIFIED AS AGRICULTURAL LAND IN RE VENUE RECORDS, THE LAND IS NOT SUBJECTED TO ANY CONVERSION AGRICULTURAL LAND BY THE ASSESSEE OR ANY OTHER CONCERNED PERSON, TRANSFERS SUCH AGRICULTURAL LAND AS IT IS AND WHERE IT IS BASIS, IN SUCH CIRCUMSTANCES, IN OUR OPINION, SUCH TRANSFER LIKE TH E CASE BEFORE US CANNOT BE CONSIDERED AS A TRANSFER OF CAPITAL ASSET OR THE TRANSACTION RELATING TO SALE OF LAND WAS NOT AN ADVENTURE IN THE NATURE OF TRADE SO AS TO TAX THE INCOME ARISING OUT OF THIS TRANSACTION AS PARK (P.) LTD. VS. ITO [2014] 41 TAXMANN.COM 109 (HYD THIS CASE THE FOLLOWING OBSERVATIONS OF THE HONBLE TRIBUNAL ARE RELEVANT TO THIS CASE. AND AS IN THE PRESENT CASE, ADMITTEDLY, THE AGRICULTURAL LAND OF THE ASSESSEE IS O UTSIDE THE MUNICIPAL LIMITS OF HYDERABAD MUNICIPALITY AND THAT ALSO 8 KM AWAY FROM THE OUTER LIMITS OF THIS MUNICIPALITY, ASSESSEE'S LAND DOES NOT COME WITHIN THE PURVIEW OF SECTION 2(14)(III) EITHER UNDER SUB CLAUSE (A) OR (B) OF THE ACT, HENCE THE SAME C ANNOT BE CONSIDERED AS CAPITAL ASSET WITHIN THE MEANING OF THIS SECTION. HENCE, NO CAPITAL GAIN TAX CAN BE CHARGED ON THE SALE TRANSACTION OF THIS LAND ENTERED BY THE ASSESSEE. THIS IS SUPPORTED BY THE ORDER OF KOLKATA BENCH OF THIS TRIBUNAL IN THE CASE OF (CITED SUPRA), HARESH V. MILANI V. JT. CIT [2008] 114 ITD 428 (PUNE) M.S. SRINIVASA NAICKER V. ITO [2007] 292 ITR 481/[2008] 169 TAXMAN 255 (MAD) BY BORROWING THE MEANING FROM THE ABOVE SECTION, WE ARE NOT ABLE TO APPRECIATE I.T.A. NO. 981/KOL/2018 ASSESSMENT YEAR: 2011-12 SANJEEV KUMAR GOYAL SECTION (14) OF SECTION 2 ITAN AREA WAS NOT THE INFORMATION RECEIVED BY THE ASSESSING OFFICER REGARDING THE LOCATION OF THE LAND BEING SITUATED AT ABOUT 3 KMS. FROM THE CHENNAI METROPOLITAN AREA THUS WAS VAGUE AND IRRELEVANT TO DECIDE THE ISSUE THE EXEMPTION CLAIMED BY THE ASSESSEES IN RESPECT OF GAIN FROM THE SALE IN THIS CASE THE ASSESSEE SOLD A PIECE OF LAND AND CLAIMED THAT THE LAND WAS AN AGRICULTURAL LAN D RECORDED IN REVENUE RECORDS AND THE SAME WAS SITUATED BEYOND 8 K.M FROM THE NEAREST EMPHATICALLY ARGUED THAT THE ASSESSING OFFICER ARRIVED AT HIS FINDING BASED ON THE FACT THAT THE LAND IN QUESTION HAD BEEN CLASSIFIED IN THE RECORDS OF THE SUB REGISTRAR OFFICE AS REVENUE LAND. HOWEVER, AS ELF, IT WAS CLASSIFIED AS AGRICULTURAL LAND IN THE REVENUE RECORDS. EVEN OTHERWISE, THE LEARNED TRIBUNAL HAD LOOKED INTO THE RELEVANT MATERIALS INCLUDING THE REVENUE RECORDS, AS ALSO E LEARNED TRIBUNAL WAS OF THE VIEW THAT WHETHER THERE WAS AGRICULTURAL INCOME OR NOT WAS NOT RELEVANT. NO FAULT CAN BE FOUND WITH THE REASONING OF THE LEARNED TRIBUNAL. THE FACT THAT THERE WAS LOSS AND NOT INCOME COULD NOT HAVE THE SLP FILED BY REVENUE AGAINST THE AFORESAID JUDGEMENT OF HONBLE MADRAS HIGH COURT WAS DISMISSED BY HONBLE SUPREME COURT [2019] 102 TAXMANN.COM URTHER, WE MAKE IT CLEAR THAT WHEN THE LAND WHICH DOES NOT FALL UNDER THE PROVISIONS OF SECTION 2(14)(III) OF THE IT ACT AND AN ASSESSEE WHO IS ENGAGED IN AGRICULTURAL OPERATIONS IN SUCH AGRICULTURAL LAND AND ALSO BEING SPECIFIED AS VENUE RECORDS, THE LAND IS NOT SUBJECTED TO ANY CONVERSION AGRICULTURAL LAND BY THE ASSESSEE OR ANY OTHER CONCERNED PERSON, TRANSFERS SUCH AGRICULTURAL LAND AS IT IS AND WHERE IT IS BASIS, IN SUCH CIRCUMSTANCES, IN OUR E CASE BEFORE US CANNOT BE CONSIDERED AS A TRANSFER OF CAPITAL ASSET OR THE TRANSACTION RELATING TO SALE OF LAND WAS NOT AN ADVENTURE IN THE NATURE OF TRADE SO AS TO TAX THE INCOME ARISING OUT OF THIS TRANSACTION AS [2014] 41 TAXMANN.COM 109 (HYD ITAT) IN THIS CASE THE FOLLOWING OBSERVATIONS OF THE HONBLE TRIBUNAL ARE RELEVANT TO THIS CASE. AND AS IN THE PRESENT CASE, ADMITTEDLY, THE AGRICULTURAL LAND UTSIDE THE MUNICIPAL LIMITS OF HYDERABAD MUNICIPALITY AND THAT ALSO 8 KM AWAY FROM THE OUTER LIMITS OF THIS MUNICIPALITY, ASSESSEE'S LAND DOES NOT COME WITHIN THE PURVIEW OF SECTION 2(14)(III) EITHER ANNOT BE CONSIDERED HENCE, NO CAPITAL GAIN TAX CAN BE CHARGED ON THE SALE TRANSACTION OF THIS LAND ENTERED BY THE ASSESSEE. THIS IS SUPPORTED BY THE ORDER OF KOLKATA BENCH OF THIS TRIBUNAL IN THE CASE OF ARIJIT [2008] 114 ITD 428 (PUNE) AND [2007] 292 ITR 481/[2008] 169 TAXMAN 255 (MAD) . BY BORROWING THE MEANING FROM THE ABOVE SECTION, WE ARE NOT ABLE TO APPRECIATE THAT THE LAND FALLS WITHIN THE TER NOTIFICATION OF CENTRAL GOVERNMENT CASE OF MADHUKUMAR N. (HUF) (CITED SUPRA) 50. FURTHER, WE MAKE IT CLEAR THAT WHEN THE LAND WHICH DOES NOT FALL UNDER THE PROVISIONS OF SECTION 2(14)(III) OF THE IT ACT AND AN ASSESSEE WHO IS ENGAGED IN AGRICULTURAL OPERATIONS IN SUCH AGRICULTURAL LAND AND ALSO BEING SPECIFIED AS AGRICULTURAL LAND IN REVENUE RECORDS, CONVERSION AS NON PERSON, TRANSFERS SUCH AGRICULTURAL LAND AS IT IS AND WHERE IT IS BASIS, IN SUCH CIRCUMSTANCES, IN OUR OPINION, SUCH TRANSFER LIKE THE CASE BEFORE US CANNOT BE CONSIDERED AS A TRANSFER OF CAPITAL ASSET TO SALE OF LAND WAS NOT AN ADVENTURE IN THE NATURE OF TRADE SO AS TO TAX THE INCOME ARISING OUT OF THIS TRANSACTION AS BUSINESS INCOME. (VI) CIT VS. SIDDHARTH J. DESAI[1982] 10 TAXMAN 1 (GUJ) = (GUJ) HELD 1. SEVERAL FACTORS ARE RELEVANT AND ARE WEIGHTED AGAINST EACH OTHER WHILE DETERMINING THE TRUE NATURE AND CHARACTER OF THE LAND. THE MAJOR FACTORS WHICH ARE CONSIDERED AS HAVING A LEANING ON THE DETERMINATION OF THE QUESTION ARE AS FOLLOWS : A. WHETHER, THE L AND WHETHER IT WAS SUBJECT TO THE PAYMENT OF LAND REVENUE, BUT THIS FACTOR ALONE WILL NOT BE CONCLUSIVE; B. WHETHER THE LAND WAS ACTUALLY OR ORDINARILY USED FOR AGRICULTURAL PURPOSES AT OR ABOUT THE C. WHETHER SUCH USER OF THE LAND WAS FOR A LONG PERIOD OR WHETHER IT WAS OF A TEMPORARY CHARACTER OR BY WAY OF STOP D. WHETHER THE INCOME DERIVED FROM THE AGRICULTURAL OPERATIONS CARRIED ON IN THE LAND BORE ANY RATIONAL PR PURCHASING THE LAND; E. WHETHER THE PERMISSION UNDER SECTION 65 OF THE BOMBAY LAND REVENUE CODE, WAS OBTAINED FOR THE NON WHEN AND BY WHOM; WHETHER SUCH PERMISSION WAS IN RESPECT OF PORTION OF THE LAND; IF THE PERMISSION WAS IN RESPECT OF A PORTION OF THE LAND AND IF IT WAS OBTAINED IN PAST, WHAT WAS THE NATURE OF THE USER OF THE SAID PORTION OF THE LAND ON THE MATERIAL DATE; F. WHETHER THE LAND, ON THE RELEVANT DATE, H AGRICULTURAL USE: IF SO, WHETHER, IT WAS PUT TO AN ALTERNATIVE USE; WHETHER, SUCH A CESS OR AND OR ALTERNATIVE USER WAS OF A PERMANENT OR TEMPORARY NATURE; G. WHETHER THE LAND, THOUGH ENTERED IN REVENUE RECORD, HAD NEVER BEEN AC TUALLY USED FOR AGRICULTURE; WHETHER THE OWNER MEANT OR INTENDED TO USE IT FOR AGRICULTURAL PURPOSES; H. WHETHER THE LAND WAS SITUATE IN A DEVELOPED AREA; WHETHER ITS PHYSICAL CHARACTERISTICS, SURROUNDING SITUATION AND USE OF THE LANDS IN THE ADJOINING ARE A WERE SUCH AS WOULD INDICATE THAT THE LAND WAS AGRICULTURAL; 15 THAT THE LAND FALLS WITHIN THE TER RITORIAL LIMIT OF ANY MUNICIPALITY WITHOUT NOTIFICATION OF CENTRAL GOVERNMENT AS HELD BY THE KARNATAKA HIGH COURT IN THE CASE OF MADHUKUMAR N. (HUF) (CITED SUPRA) FURTHER, WE MAKE IT CLEAR THAT WHEN THE LAND WHICH DOES NOT FALL UNDER THE SECTION 2(14)(III) OF THE IT ACT AND AN ASSESSEE WHO IS ENGAGED IN AGRICULTURAL OPERATIONS IN SUCH AGRICULTURAL LAND AND ALSO BEING SPECIFIED AS AGRICULTURAL LAND IN REVENUE RECORDS, THE LAND IS NOT SUBJECTED TO ANY CONVERSION AS NON -AGRICULTURAL LAND BY T HE ASSESSEE OR ANY OTHER CONCERNED PERSON, TRANSFERS SUCH AGRICULTURAL LAND AS IT IS AND WHERE IT IS BASIS, IN SUCH CIRCUMSTANCES, IN OUR OPINION, SUCH TRANSFER LIKE THE CASE BEFORE US CANNOT BE CONSIDERED AS A TRANSFER OF CAPITAL ASSET OR THE TRANSACTION TO SALE OF LAND WAS NOT AN ADVENTURE IN THE NATURE OF TRADE SO AS TO TAX THE INCOME ARISING OUT OF THIS TRANSACTION AS BUSINESS INCOME. CIT VS. SIDDHARTH J. DESAI[1982] 10 TAXMAN 1 (GUJ) = [1983] 139 ITR 628 SEVERAL FACTORS ARE RELEVANT AND ARE WEIGHTED AGAINST EACH OTHER WHILE DETERMINING THE TRUE NATURE AND CHARACTER OF THE LAND. THE MAJOR FACTORS WHICH ARE CONSIDERED AS HAVING A LEANING ON THE DETERMINATION OF THE QUESTION ARE AS FOLLOWS : WHETHER, THE L AND WAS CLASSIFIED IN THE REVENUE RECORD AS AGRICULTURAL AND WHETHER IT WAS SUBJECT TO THE PAYMENT OF LAND REVENUE, BUT THIS FACTOR ALONE WILL NOT BE CONCLUSIVE; WHETHER THE LAND WAS ACTUALLY OR ORDINARILY USED FOR AGRICULTURAL PURPOSES AT OR ABOUT THE RELEVANT TIME; WHETHER SUCH USER OF THE LAND WAS FOR A LONG PERIOD OR WHETHER IT WAS OF A TEMPORARY CHARACTER OR BY WAY OF STOP -GAP ARRANGEMENT; WHETHER THE INCOME DERIVED FROM THE AGRICULTURAL OPERATIONS CARRIED ON IN THE LAND BORE ANY RATIONAL PR OPORTION TO THE INVESTMENT MADE IN PURCHASING THE LAND; WHETHER THE PERMISSION UNDER SECTION 65 OF THE BOMBAY LAND REVENUE CODE, WAS OBTAINED FOR THE NON - AGRICULTURAL USE OF THE LANDS: IF SO, WHEN AND BY WHOM; WHETHER SUCH PERMISSION WAS IN RESPECT OF THE WHOLE OR A PORTION OF THE LAND; IF THE PERMISSION WAS IN RESPECT OF A PORTION OF THE LAND AND IF IT WAS OBTAINED IN PAST, WHAT WAS THE NATURE OF THE USER OF THE SAID PORTION OF THE LAND ON THE MATERIAL DATE; WHETHER THE LAND, ON THE RELEVANT DATE, H AD CEASED TO BE PUT TO THE AGRICULTURAL USE: IF SO, WHETHER, IT WAS PUT TO AN ALTERNATIVE USE; WHETHER, SUCH A CESS OR AND OR ALTERNATIVE USER WAS OF A PERMANENT OR TEMPORARY NATURE; WHETHER THE LAND, THOUGH ENTERED IN REVENUE RECORD, HAD NEVER BEEN TUALLY USED FOR AGRICULTURE; WHETHER THE OWNER MEANT OR INTENDED TO USE IT FOR AGRICULTURAL PURPOSES; WHETHER THE LAND WAS SITUATE IN A DEVELOPED AREA; WHETHER ITS PHYSICAL CHARACTERISTICS, SURROUNDING SITUATION AND USE OF THE LANDS IN THE A WERE SUCH AS WOULD INDICATE THAT THE LAND WAS AGRICULTURAL; I.T.A. NO. 981/KOL/2018 ASSESSMENT YEAR: 2011-12 SANJEEV KUMAR GOYAL RITORIAL LIMIT OF ANY MUNICIPALITY WITHOUT AS HELD BY THE KARNATAKA HIGH COURT IN THE FURTHER, WE MAKE IT CLEAR THAT WHEN THE LAND WHICH DOES NOT FALL UNDER THE SECTION 2(14)(III) OF THE IT ACT AND AN ASSESSEE WHO IS ENGAGED IN AGRICULTURAL OPERATIONS IN SUCH AGRICULTURAL LAND AND ALSO BEING SPECIFIED AS THE LAND IS NOT SUBJECTED TO ANY HE ASSESSEE OR ANY OTHER CONCERNED PERSON, TRANSFERS SUCH AGRICULTURAL LAND AS IT IS AND WHERE IT IS BASIS, IN SUCH CIRCUMSTANCES, IN OUR OPINION, SUCH TRANSFER LIKE THE CASE BEFORE US OR THE TRANSACTION RELATING TO SALE OF LAND WAS NOT AN ADVENTURE IN THE NATURE OF TRADE SO AS TO TAX THE INCOME [1983] 139 ITR 628 SEVERAL FACTORS ARE RELEVANT AND ARE WEIGHTED AGAINST EACH OTHER WHILE DETERMINING THE TRUE NATURE AND CHARACTER OF THE LAND. THE MAJOR FACTORS WHICH ARE CONSIDERED AS HAVING A LEANING ON THE DETERMINATION OF THE AND WAS CLASSIFIED IN THE REVENUE RECORD AS AGRICULTURAL AND WHETHER IT WAS SUBJECT TO THE PAYMENT OF LAND REVENUE, BUT THIS FACTOR WHETHER THE LAND WAS ACTUALLY OR ORDINARILY USED FOR AGRICULTURAL WHETHER SUCH USER OF THE LAND WAS FOR A LONG PERIOD OR WHETHER IT WAS WHETHER THE INCOME DERIVED FROM THE AGRICULTURAL OPERATIONS CARRIED OPORTION TO THE INVESTMENT MADE IN WHETHER THE PERMISSION UNDER SECTION 65 OF THE BOMBAY LAND AGRICULTURAL USE OF THE LANDS: IF SO, THE WHOLE OR A PORTION OF THE LAND; IF THE PERMISSION WAS IN RESPECT OF A PORTION OF THE LAND AND IF IT WAS OBTAINED IN PAST, WHAT WAS THE NATURE OF THE USER OF THE SAID AD CEASED TO BE PUT TO THE AGRICULTURAL USE: IF SO, WHETHER, IT WAS PUT TO AN ALTERNATIVE USE; WHETHER, SUCH A CESS OR AND OR ALTERNATIVE USER WAS OF A PERMANENT OR TEMPORARY NATURE; WHETHER THE LAND, THOUGH ENTERED IN REVENUE RECORD, HAD NEVER BEEN TUALLY USED FOR AGRICULTURE; WHETHER THE OWNER MEANT OR INTENDED TO USE IT WHETHER THE LAND WAS SITUATE IN A DEVELOPED AREA; WHETHER ITS PHYSICAL CHARACTERISTICS, SURROUNDING SITUATION AND USE OF THE LANDS IN THE A WERE SUCH AS WOULD INDICATE THAT THE LAND WAS AGRICULTURAL; I. WHETHER THE LAND ITSELF WAS DEVELOPED BY PLOTTING AND PROVIDING ROADS AND OTHER FACILITIES; J. WHETHER THERE WERE ANY PREVIOUS SALES OF PORTIONS OF THE LAND FOR NON AGRICULTURAL USE; K. W HETHER PERMISSION UNDER SECTION 63 OF THE BOMBAY TENANCY AND AGRICULTURAL LANDS ACT, WAS OBTAINED BECAUSE THE SALE OR INTENDED SALE WAS IN FAVOUR OF A NON- AGRICULTURIST: IF SO, WHETHER THE SALE OR INTENDED SALE TO SUCH NON- AGRICULTURIST WAS FOR NON L. WHETHER AN AGRICULTURIST WOULD PURCHASE THE LAND FOR AGRICULTURAL PURPOSES AT THE PRICE AT WHICH THE LAND WAS SOLD AND WHETHER THE OWNER WOULD HAVE EVER SOLD THE LAND VALUING IT AS A PROPERTY YIELDING AGRICULTURAL PRODUCE ON THE BASIS OF ITS YIELD; AND M. WHETHER THE LAND WAS SOLD ON YARDAGE OR ON ACREAGE BASIS. 2. HAVING REGARD TO THE FACTS AND FINDINGS RECORDED BY THE TRIBUNAL, IT WAS OBVIOUS THAT NOT ONLY THE PHYSICAL CHARACTERISTICS OF LAND, IN THE INSTANT CASE, BUT THE US ER ALSO WAS AGRICULTURAL. EVEN THOUGH THE LAND WAS NOT ACTUALLY PUT TO AGRICULTURAL USE SINCE ABOUT ONE YEAR PRIOR TO THE SALE, THERE WAS NO EVIDENCE TO ESTABLISH THAT IT WAS CONVERTED TO ANY OTHER USE. PERMISSION UNDER SECTION 63 OF THE BOMB ACT WAS OBTAINED BY THE ASSESSEE TO SELL THE LANDS TO THE SOCIETY FOR RESIDENTIAL PURPOSES WOULD NOT, MILITATE AGAINST THE LAND CONTINUING TO BE AGRICULTURAL ON THE DATE OF ITS SALE, AS THE PERMISSION WAS OBTAINED ONLY ABO MONTHS PRIOR TO THE SALE. THEREFORE, TILL THE LAND WAS HELD BY THE ASSESSEE ITS CHARACTER AS AGRICULTURAL LAND WAS NOT CHANGED EITHER AS A RESULT OF ITS RE CLASSIFICATI ON IN THE REVENUE RECORDS OR BY THE ACTUAL ALTERATION OF ITS USE. AGAI N, THERE WAS NO EVIDENCE ON RECORD TO SHOW THAT THERE WAS ANY DEVELOPMENT IN THE SURROUNDING AREA OR THAT THE LAND ITSELF WAS DEVELOPED PRIOR TO ITS SALE. THE LAND WAS LOCATED ON THE OUTSKIRTS OF THE VILLAGE BUT IT WAS NOT SITUATE IN THE MUNICIPAL LIMIT. T BEEN SITUATE IN A RURAL AREA AND IT CONTINUED TO HAVE AN AGRICULTURAL BIAS RIGHT UP TO THE DATE OF ITS SALE. FURTHER, THERE WAS NO EVIDENCE OR MATERIAL ON RECORD TO INDICATE THAT THE PRICE OFFERED FOR THE LAND BY ON THE BASIS THAT' THE INTENDED USER OF HIS PART WAS NON NOT HAVE BEEN OFFERED BY AN AGRICULTURE WHO WANTED TO PURCHASE THE LAND FOR PURELY AGRICULTURAL USER. THERE BEING NO EVIDENCE ON RECORD AS REGARD THE NATURE OF THE SOIL, ITS FERTILITY, ITS SUITABILITY AND ADAPTABILITY FOR RAISING CASH CROPS, THE IRRIGATION FACILITY AND SUCH OR SIMILAR FACTORS WHICH HAD A GREAT BEARING ON THE VALUATION OF AN AGRICULTURAL LAND, IT WOULD BE HAZARDOUS TO COME TO THE CONCLU WOULD HAVE PAID THE SAME IF HE WANTED TO PURCHASE THE LAND FOR PURELY AGRICULTURAL PURPOSES. 3. ACCORDINGLY, THE LAND WAS AN AGRICULTURAL LAND AND THE SURPLUS REALISED ON A SALE THEREOF WAS NOT LIA 16 WHETHER THE LAND ITSELF WAS DEVELOPED BY PLOTTING AND PROVIDING ROADS AND OTHER FACILITIES; WHETHER THERE WERE ANY PREVIOUS SALES OF PORTIONS OF THE LAND FOR NON HETHER PERMISSION UNDER SECTION 63 OF THE BOMBAY TENANCY AND AGRICULTURAL LANDS ACT, WAS OBTAINED BECAUSE THE SALE OR INTENDED SALE WAS IN AGRICULTURIST: IF SO, WHETHER THE SALE OR INTENDED SALE TO SUCH AGRICULTURIST WAS FOR NON -AGRICULTURAL OR AGRICULTURAL USER: WHETHER AN AGRICULTURIST WOULD PURCHASE THE LAND FOR AGRICULTURAL PURPOSES AT THE PRICE AT WHICH THE LAND WAS SOLD AND WHETHER THE OWNER WOULD HAVE EVER SOLD THE LAND VALUING IT AS A PROPERTY YIELDING AGRICULTURAL THE BASIS OF ITS YIELD; AND WHETHER THE LAND WAS SOLD ON YARDAGE OR ON ACREAGE BASIS. 2. HAVING REGARD TO THE FACTS AND FINDINGS RECORDED BY THE TRIBUNAL, IT WAS OBVIOUS THAT NOT ONLY THE PHYSICAL CHARACTERISTICS OF LAND, IN THE INSTANT CASE, ER ALSO WAS AGRICULTURAL. EVEN THOUGH THE LAND WAS NOT ACTUALLY PUT TO AGRICULTURAL USE SINCE ABOUT ONE YEAR PRIOR TO THE SALE, THERE WAS NO EVIDENCE TO ESTABLISH THAT IT WAS CONVERTED TO ANY OTHER USE. THE FACT THAT PERMISSION UNDER SECTION 63 OF THE BOMB AY TENANCY AND AGRICULTURAL LANDS ACT WAS OBTAINED BY THE ASSESSEE TO SELL THE LANDS TO THE SOCIETY FOR RESIDENTIAL PURPOSES WOULD NOT, MILITATE AGAINST THE LAND CONTINUING TO BE AGRICULTURAL ON THE DATE OF ITS SALE, AS THE PERMISSION WAS OBTAINED ONLY ABO UT TWO AND A HALF MONTHS PRIOR TO THE SALE. THEREFORE, TILL THE LAND WAS HELD BY THE ASSESSEE ITS CHARACTER AS AGRICULTURAL LAND WAS NOT CHANGED EITHER AS A RESULT OF ITS RE ON IN THE REVENUE RECORDS OR BY THE ACTUAL ALTERATION OF ITS USE. N, THERE WAS NO EVIDENCE ON RECORD TO SHOW THAT THERE WAS ANY DEVELOPMENT IN THE SURROUNDING AREA OR THAT THE LAND ITSELF WAS DEVELOPED PRIOR TO ITS SALE. THE LAND WAS LOCATED ON THE OUTSKIRTS OF THE VILLAGE BUT IT WAS NOT SITUATE IN THE MUNICIPAL LIMIT. T HE LAND MUST, THEREFORE, BE TAKEN AS HAVING BEEN SITUATE IN A RURAL AREA AND IT CONTINUED TO HAVE AN AGRICULTURAL BIAS RIGHT UP TO THE DATE OF ITS SALE. FURTHER, THERE WAS NO EVIDENCE OR MATERIAL ON RECORD TO INDICATE THAT THE PRICE OFFERED FOR THE LAND BY THE SOCIETY, EVEN PROCEEDING ON THE BASIS THAT' THE INTENDED USER OF HIS PART WAS NON - AGRICULTURAL, WOULD NOT HAVE BEEN OFFERED BY AN AGRICULTURE WHO WANTED TO PURCHASE THE LAND FOR PURELY AGRICULTURAL USER. THERE BEING NO EVIDENCE ON RECORD AS REGARD THE NATURE OF THE SOIL, ITS FERTILITY, ITS SUITABILITY AND ADAPTABILITY FOR RAISING CASH CROPS, THE IRRIGATION FACILITY AND SUCH OR SIMILAR FACTORS WHICH HAD A GREAT BEARING ON THE VALUATION OF AN AGRICULTURAL LAND, IT WOULD BE HAZARDOUS TO COME TO THE CONCLU SION THAT THE PRICE OFFERED WAS SUCH THAT NO AGRICULTURIST WOULD HAVE PAID THE SAME IF HE WANTED TO PURCHASE THE LAND FOR PURELY AGRICULTURAL PURPOSES. 3. ACCORDINGLY, THE LAND WAS AN AGRICULTURAL LAND AND THE SURPLUS REALISED ON A SALE THEREOF WAS NOT LIA BLE TO BE ASSESSED TO CAPITAL GAINS TAX. I.T.A. NO. 981/KOL/2018 ASSESSMENT YEAR: 2011-12 SANJEEV KUMAR GOYAL WHETHER THE LAND ITSELF WAS DEVELOPED BY PLOTTING AND PROVIDING WHETHER THERE WERE ANY PREVIOUS SALES OF PORTIONS OF THE LAND FOR NON - HETHER PERMISSION UNDER SECTION 63 OF THE BOMBAY TENANCY AND AGRICULTURAL LANDS ACT, WAS OBTAINED BECAUSE THE SALE OR INTENDED SALE WAS IN AGRICULTURIST: IF SO, WHETHER THE SALE OR INTENDED SALE TO SUCH WHETHER AN AGRICULTURIST WOULD PURCHASE THE LAND FOR AGRICULTURAL PURPOSES AT THE PRICE AT WHICH THE LAND WAS SOLD AND WHETHER THE OWNER WOULD HAVE EVER SOLD THE LAND VALUING IT AS A PROPERTY YIELDING AGRICULTURAL 2. HAVING REGARD TO THE FACTS AND FINDINGS RECORDED BY THE TRIBUNAL, IT WAS OBVIOUS THAT NOT ONLY THE PHYSICAL CHARACTERISTICS OF LAND, IN THE INSTANT CASE, ER ALSO WAS AGRICULTURAL. EVEN THOUGH THE LAND WAS NOT ACTUALLY PUT TO AGRICULTURAL USE SINCE ABOUT ONE YEAR PRIOR TO THE SALE, THERE WAS NO THE FACT THAT AY TENANCY AND AGRICULTURAL LANDS ACT WAS OBTAINED BY THE ASSESSEE TO SELL THE LANDS TO THE SOCIETY FOR RESIDENTIAL PURPOSES WOULD NOT, MILITATE AGAINST THE LAND CONTINUING TO BE AGRICULTURAL ON UT TWO AND A HALF MONTHS PRIOR TO THE SALE. THEREFORE, TILL THE LAND WAS HELD BY THE ASSESSEE ITS CHARACTER AS AGRICULTURAL LAND WAS NOT CHANGED EITHER AS A RESULT OF ITS RE - ON IN THE REVENUE RECORDS OR BY THE ACTUAL ALTERATION OF ITS USE. N, THERE WAS NO EVIDENCE ON RECORD TO SHOW THAT THERE WAS ANY DEVELOPMENT IN THE SURROUNDING AREA OR THAT THE LAND ITSELF WAS DEVELOPED PRIOR TO ITS SALE. THE LAND WAS LOCATED ON THE OUTSKIRTS OF THE VILLAGE BUT IT WAS HE LAND MUST, THEREFORE, BE TAKEN AS HAVING BEEN SITUATE IN A RURAL AREA AND IT CONTINUED TO HAVE AN AGRICULTURAL BIAS RIGHT UP TO THE DATE OF ITS SALE. FURTHER, THERE WAS NO EVIDENCE OR MATERIAL ON RECORD THE SOCIETY, EVEN PROCEEDING AGRICULTURAL, WOULD NOT HAVE BEEN OFFERED BY AN AGRICULTURE WHO WANTED TO PURCHASE THE LAND FOR PURELY AGRICULTURAL USER. THERE BEING NO EVIDENCE ON RECORD AS REGARD THE NATURE OF THE SOIL, ITS FERTILITY, ITS SUITABILITY AND ADAPTABILITY FOR RAISING CASH CROPS, THE IRRIGATION FACILITY AND SUCH OR SIMILAR FACTORS WHICH HAD A GREAT BEARING ON THE VALUATION OF AN AGRICULTURAL LAND, IT WOULD BE HAZARDOUS TO SION THAT THE PRICE OFFERED WAS SUCH THAT NO AGRICULTURIST WOULD HAVE PAID THE SAME IF HE WANTED TO PURCHASE THE LAND FOR PURELY 3. ACCORDINGLY, THE LAND WAS AN AGRICULTURAL LAND AND THE SURPLUS REALISED ON A PROPOSITION 2:- THAT THE CAPITAL ASSET WOULD NOT LOSE ITS CHARACTER OF BEING AN AGRICULTURAL LAND MERELY BECAUSE THE CULTIVATION OF THE SAID LAND WAS DONE BY A PERSON OTHER THAN THE ASSESSEE. PROPOSITION 3:- THAT THE CHARACTERISTICS OF THE AGRICULTURAL LAND WOULD NOT BE LOST EVEN THOUGH THE LAND WAS NOT USED FOR AGRICULTURAL PURPOSES PRIOR TO ITS SALE. PROPOSITION 4:- THAT THE SALE OF LAND TO AN INDUSTRIAL UNIT, WHEN THE CONVERSION OF LAND TAKES PLACE SUBSEQUENT TO THAT THE LAND SOLD IS NOT AGRICULTURAL LAND. KHAITAN LEFIN LIMITED VS. CIT ITA NO.200/KOL/2016, JUDGMENT DATED 25.01.2019 (KOL TRIB.) 4. THERE IS NO DISPUTE THAT THE ASSESSEE HAD INDEED SOLD ITS LAND IN QUESTION MEASURING 5.33 ACRES SITUATED IN VILLAGE MAMIDIPALLY MANDAL SAROONAGAR DISTRICT RANGA REDDY IN ERSTWHILE ANDHRA PRADESH DURING THE RELEVANT PREVIOUS YEAR; THE SOLE DISPUTE IN TH ADJUDICATION IS AS TO WHETHER THE ASSESSEE'S LAND SOLD WAS A CAPITAL ASSET OR NOT FALLING WITHIN 8 KMS. OF THE 'GHMC' U/S 2(14)(III)(B) OF APPLICABLE IN THE IMPUGNED ASSESSMENT YEAR. THE TAXPAYER STAND THRO UGHOUT IS THAT ITS LAND IS NOT A CAPITAL ASSET SINCE IT IS SITUATED BEYOND 8 KMS. DISTANCE OF ANY MUNICIPALITY WHEREAS THE REVENUE'S CASE IS THAT MAMIDIPALLY GRAM PANCHAYAT IS ADJACENT TO THE GHMC LIMITS. AND ALSO THAT IS HAPPENS TO BE A HUB OF MAJOR ECONO WE FIND NO MERIT IN THE LATTERS STAND BASED ON THE LOWER AUTHORITY'S RESPECTIVE FINDINGS. WE MAKE IT CLEAR FIRST OF ALL THAT THERE IS NO REBUTTAL COMING FROM THE DEPARTMENT CON VERTED FROM AGRICULTURAL TO NON BEFORE THE SALE IN QUESTION. SUPPORT THE ASSESSEE'S CASE RATHER THAT ITS LANDS ARE VERY MUCH AGRICULTURAL IN NATURE. THE ASSESSING OFFICER DETERMINATION OF LAND IN ISSUE WHAT IS REQUIRED TO BE SHOWN IS CONNECTION WITH THE AGRICULTURAL PURPOSE IS THE USE AND NOT THE MERE POSSIBILITY OF THE LAND USER BY SOME POSSIBLE FUTURE OWNER FOR AGRICULTURAL OBJE MERIT IN THE IMPUGNED REASONING. AGRICULTURAL LANDS BEYOND 8 KMS. FROM THE LOCAL MUNICIPALITY ETC.; AS THE CENTRAL GOVERNMENT MAY, HAVING REGARD TO THE EXTENT/SCOPE FOR URBANISATION AND OTHER CONSIDERATION DCIT V. P. ASHOK KUMAR ITA NO.1581/MDS/2010, JUDGMENT DATED 20.01.2011 (CHENNAI TRIB.) 6. THERE ARE GOOD REASONS GIVEN BY THE LD.AR FOR EXPLAINING THAT THE LAND WAS NOT RECENTLY USED FOR CULTIVATION. CULTIVATION OF A PIECE OF LAND DOES NOT LOOSE ITS CHARACTER OF 17 THAT THE CAPITAL ASSET WOULD NOT LOSE ITS CHARACTER OF BEING AN AGRICULTURAL LAND MERELY BECAUSE THE CULTIVATION OF THE SAID LAND WAS DONE BY A PERSON OTHER THAN THE ASSESSEE. THE CHARACTERISTICS OF THE AGRICULTURAL LAND WOULD NOT BE LOST EVEN THOUGH THE LAND WAS NOT USED FOR AGRICULTURAL PURPOSES PRIOR TO ITS SALE. THAT THE SALE OF LAND TO AN INDUSTRIAL UNIT, WHEN THE CONVERSION OF LAND TAKES PLACE SUBSEQUENT TO THE SALE BY THE BUYER, CANNOT LEAD TO A CONCLUSION THAT THE LAND SOLD IS NOT AGRICULTURAL LAND. KHAITAN LEFIN LIMITED VS. CIT ITA NO.200/KOL/2016, JUDGMENT DATED 25.01.2019 (KOL TRIB.) 4. THERE IS NO DISPUTE THAT THE ASSESSEE HAD INDEED SOLD ITS LAND IN QUESTION MEASURING 5.33 ACRES SITUATED IN VILLAGE MAMIDIPALLY MANDAL SAROONAGAR DISTRICT RANGA REDDY IN ERSTWHILE ANDHRA PRADESH DURING THE RELEVANT PREVIOUS YEAR; THE SOLE DISPUTE IN TH E INSTANT LIS THAT ARISES FOR OUR APT ADJUDICATION IS AS TO WHETHER THE ASSESSEE'S LAND SOLD WAS A CAPITAL ASSET OR NOT FALLING WITHIN 8 KMS. OF THE 'GHMC' U/S 2(14)(III)(B) OF THE ACT AS APPLICABLE IN THE IMPUGNED ASSESSMENT YEAR. THE TAXPAYER STAND UGHOUT IS THAT ITS LAND IS NOT A CAPITAL ASSET SINCE IT IS SITUATED BEYOND 8 KMS. DISTANCE OF ANY MUNICIPALITY WHEREAS THE REVENUE'S CASE IS THAT MAMIDIPALLY GRAM PANCHAYAT IS ADJACENT TO THE GHMC LIMITS. AND ALSO THAT IS HAPPENS TO BE A HUB OF MAJOR ECONO MIC ACTIVITY INCLUDING AVIATION SECTOR. WE FIND NO MERIT IN THE LATTERS STAND BASED ON THE LOWER AUTHORITY'S RESPECTIVE FINDINGS. WE MAKE IT CLEAR FIRST OF ALL THAT THERE IS NO REBUTTAL COMING FROM THE DEPARTMENT THAT THE LAND IN QUESTION HAS EVER BEEN VERTED FROM AGRICULTURAL TO NON - AGRICULTURAL USE AT ANY POINT OF TIME BEFORE THE SALE IN QUESTION. THE STATE GOVERNMENT'S REVENUE RECORDS STRONGLY SUPPORT THE ASSESSEE'S CASE RATHER THAT ITS LANDS ARE VERY MUCH AGRICULTURAL THE ASSESSING OFFICER TRIED TO APPLY 'PERFORMANCE' TEST THAT FOR DETERMINATION OF LAND IN ISSUE WHAT IS REQUIRED TO BE SHOWN IS CONNECTION WITH THE AGRICULTURAL PURPOSE IS THE USE AND NOT THE MERE POSSIBILITY OF THE LAND USER BY SOME POSSIBLE FUTURE OWNER FOR AGRICULTURAL OBJE CTS. WE SEE NO MERIT IN THE IMPUGNED REASONING. THE LEGISLATURE MAKES IT CLEAR THAT AGRICULTURAL LANDS BEYOND 8 KMS. FROM THE LOCAL MUNICIPALITY ETC.; AS THE CENTRAL GOVERNMENT MAY, HAVING REGARD TO THE EXTENT/SCOPE FOR URBANISATION AND OTHER CONSIDERATION , SPECIFICALLY IN THE BEHALF. . DCIT V. P. ASHOK KUMAR ITA NO.1581/MDS/2010, JUDGMENT DATED 20.01.2011 (CHENNAI TRIB.) 6. THERE ARE GOOD REASONS GIVEN BY THE LD.AR FOR EXPLAINING THAT THE LAND WAS NOT RECENTLY USED FOR CULTIVATION. IN OUR CONSIDERED OPINION, THE NON CULTIVATION OF A PIECE OF LAND DOES NOT LOOSE ITS CHARACTER OF I.T.A. NO. 981/KOL/2018 ASSESSMENT YEAR: 2011-12 SANJEEV KUMAR GOYAL THAT THE CAPITAL ASSET WOULD NOT LOSE ITS CHARACTER OF BEING AN AGRICULTURAL LAND MERELY BECAUSE THE CULTIVATION OF THE SAID LAND WAS DONE BY A THE CHARACTERISTICS OF THE AGRICULTURAL LAND WOULD NOT BE LOST EVEN THOUGH THE LAND WAS NOT USED FOR AGRICULTURAL PURPOSES PRIOR TO ITS SALE. THAT THE SALE OF LAND TO AN INDUSTRIAL UNIT, WHEN THE CONVERSION OF THE SALE BY THE BUYER, CANNOT LEAD TO A CONCLUSION 4. THERE IS NO DISPUTE THAT THE ASSESSEE HAD INDEED SOLD ITS LAND IN QUESTION MEASURING 5.33 ACRES SITUATED IN VILLAGE MAMIDIPALLY MANDAL SAROONAGAR DISTRICT RANGA REDDY IN ERSTWHILE ANDHRA PRADESH DURING THE RELEVANT E INSTANT LIS THAT ARISES FOR OUR APT ADJUDICATION IS AS TO WHETHER THE ASSESSEE'S LAND SOLD WAS A CAPITAL ASSET OR THE ACT AS APPLICABLE IN THE IMPUGNED ASSESSMENT YEAR. THE TAXPAYER STAND UGHOUT IS THAT ITS LAND IS NOT A CAPITAL ASSET SINCE IT IS SITUATED BEYOND 8 KMS. DISTANCE OF ANY MUNICIPALITY WHEREAS THE REVENUE'S CASE IS THAT MAMIDIPALLY GRAM PANCHAYAT IS ADJACENT TO THE GHMC LIMITS. AND ALSO THAT MIC ACTIVITY INCLUDING AVIATION SECTOR. WE FIND NO MERIT IN THE LATTERS STAND BASED ON THE LOWER AUTHORITY'S RESPECTIVE FINDINGS. WE MAKE IT CLEAR FIRST OF ALL THAT THERE IS NO REBUTTAL THAT THE LAND IN QUESTION HAS EVER BEEN AGRICULTURAL USE AT ANY POINT OF TIME THE STATE GOVERNMENT'S REVENUE RECORDS STRONGLY SUPPORT THE ASSESSEE'S CASE RATHER THAT ITS LANDS ARE VERY MUCH AGRICULTURAL TRIED TO APPLY 'PERFORMANCE' TEST THAT FOR DETERMINATION OF LAND IN ISSUE WHAT IS REQUIRED TO BE SHOWN IS CONNECTION WITH THE AGRICULTURAL PURPOSE IS THE USE AND NOT THE MERE POSSIBILITY OF THE CTS. WE SEE NO THE LEGISLATURE MAKES IT CLEAR THAT AGRICULTURAL LANDS BEYOND 8 KMS. FROM THE LOCAL MUNICIPALITY ETC.; AS THE CENTRAL GOVERNMENT MAY, HAVING REGARD TO THE EXTENT/SCOPE FOR 6. THERE ARE GOOD REASONS GIVEN BY THE LD.AR FOR EXPLAINING THAT THE LAND IN OUR CONSIDERED OPINION, THE NON - CULTIVATION OF A PIECE OF LAND DOES NOT LOOSE ITS CHARACTER OF AGRICULTURAL LAND UNLESS THE USER OF THE LAND HAS BEEN SPECIFICALLY GOT CHANGED BEFORE SUCH SALE. LIKEWISE, THE FUTURE USE OF THIS LAND WILL NOT DISENTITLE TH E ASSESSEE FROM THE BENEFIT AS WAS AVAILABLE TO HIM AT THE TIME OF THE SALE. THEREFORE, WE REAFFIRM THAT THE CUMULATIVE EFFECT OF THE ABOVE MENTIONED FACTS AND CIRCUMSTANCES IS THAT THE LAND IN QUESTION WAS AGRICULTURAL LAND AT THE TIME OF SALE AND THE A TERM CAPITAL GAINS THEREON. 7. WE HAVE CONSIDERED THE RIVAL SUBMISSIONS AND HAVE PERUSED THE ENTIRE RECORDS. THE ASSESSEE HAD PURCHASED 2.14 ACRES OF AGRICULTURAL LAND FROM ONE SHREE HARIKRISHNA BRICK WORKS, CHENNAI, VIDE SALE D FOR A TOTAL CONSIDERATION OF ` 8,10,000/ A COMPANY BY THE NAME ESTRA IT PARK PVT. LTD, FOR A TOTAL CONSIDERATION OF RS.12,42,00,000/- , VIDE SALE DEED DATED 24.1.2007. IN THE SALE DEED, IT IS MENTIONE D IN PARA 3 THAT THE ASSESSEE IS COMPELLED TO SELL THE PROPERTY AS AT PRESENT IT IS NOT FETCHING ANY INCOME. THE ISSUE INVOLVED BEFORE US IS AS TO WHETHER THE LAND SOLD IS AGRICULTURAL LAND OR IT IS TO BE TREATED AS A CAPITAL ASSET IN THE TERMS OF SECTION AGRICULTURAL LAND IS NOT GIVEN IN THE INCOME CONTRIBUTE TO ASCERTAIN THE CORRECT NATURE OF A PARTICULAR PIECE OF LAND. IF A LAND IS SITUATED WITHIN 8 KMS OF THE MUNICIPAL LIMI RECORDED AS AGRICULTURAL LAND IN THE REVENUE RECORDS, IT IS TO BE TREATED AS NON- AGRICULTURAL LAND AND FOR THAT MATTER AN ASSET BUT IN THIS CASE, THE ADMITTED FACT IS THAT THIS LAND FALLS BEYOND 8 KMS FROM THE NOTIFIED LIMIT. IT TRUE THAT AS PER REVENUE RECORDS, THE LAND HAS BEEN RECORDED AS AGRICULTURAL LAND. IT IS FOUND TO BE A FACT THAT THE ASSESSEE HAS BEEN SHOWING AGRICULTURAL INCOME FROM THIS VERY LAND AND THE SAME HAS BEEN ACCEPTED BY THE REVENUE AS SUCH YEAR AFTER YEAR. TIME IT WAS LOW LYING AS SOME MUD WAS TAKEN FROM IT FOR MAKING BRICKS ETC. BUT ADMITTEDLY AFTER PURCHASE, NO SUCH ACTIVITY WAS CARRIED OUT ON THIS LAND. EVEN IF WE ACCEPT THE CONTENTION OF THE REVENUE THA PRODUCTION WAS DONE BY THE ASSESSEE ON THIS LAND, THIS MERE FACT WILL NOT TAKE OUT THE LAND OUT OF THE NOMENCLATURE OF AGRICULTURAL LAND. THE ASSESSEE GROWS COCONUT ON THIS LAND AND THE SAME ARE SOLD IN THE MARKET AND THESE RECEIPTS ARE REVENUE. THE ASSESSEE HAS ALSO PAID AGRICULTURAL LAND TAX AND COPIES OF THE SAME WERE MADE AVAILABLE TO THE AUTHORITIES. SITUATED IN THE REVENUE ESTATE OF A VILLAGE NAMED IYYAPPANTHANGAL PANC HAYAT WHICH IS SITUATED MORE THAN 8 KMS AWAY FROM THE LIMITS OF ALANDUR MUNICIPALITY. WE HAVE FOUND THAT THE LAND HAS BEEN AGRICULTURAL LAND FOR THE PAST MANY YEARS AND HAS BEEN CLASSIFIED AS SUCH IN THE RECORDS OF THE REVENUE DEPARTMENT. RESPECT OF LAND ON 30.1.2007 REGARDING FASLI YEARS 1413, 1414, 1415 AND 1416. IT WAS BROUGHT ON RECORD THAT THIS LAND WAS BEING CULTIVATED BY ONE LOCAL PERSON, NAMELY SHRI MURUGAN, BUT FOR ASSESSMENT YEARS 2005 2006-07, AGRICULTURAL OPERATIONS WERE CARRIED OUT BY HIM, HE COULD NOT GET FOOD RETURNS AND THAT IS WHY HE DID NOT ADMIT ANY AGRICULTURAL INCOME IN THE RETURNS FILED. THE REPORT OF THE TAHSILDAR REFERS TO NON LAND BECAUSE AN AGRICULTURAL OPERATIO ON THIS LAND. HENCE, WE HOLD THAT THE LAND SOLD BY THE ASSESSEE IS ONLY AGRICULTURAL LAND AND NOT A CAPITAL ASSET. THEREFORE, NO LONG TERM CAPITAL 18 AGRICULTURAL LAND UNLESS THE USER OF THE LAND HAS BEEN SPECIFICALLY GOT CHANGED BEFORE SUCH SALE. LIKEWISE, THE FUTURE USE OF THIS LAND WILL NOT E ASSESSEE FROM THE BENEFIT AS WAS AVAILABLE TO HIM AT THE THEREFORE, WE REAFFIRM THAT THE CUMULATIVE EFFECT OF THE ABOVE MENTIONED FACTS AND CIRCUMSTANCES IS THAT THE LAND IN QUESTION WAS AGRICULTURAL LAND AT THE TIME OF SALE AND THE A SSESSEE IS ENTITLED TO LONG TERM CAPITAL GAINS THEREON. 7. WE HAVE CONSIDERED THE RIVAL SUBMISSIONS AND HAVE PERUSED THE ENTIRE RECORDS. THE ASSESSEE HAD PURCHASED 2.14 ACRES OF AGRICULTURAL LAND FROM ONE SHREE HARIKRISHNA BRICK WORKS, CHENNAI, VIDE SALE D EED DATED 27.9.1994 FOR A TOTAL CONSIDERATION OF ` 8,10,000/ - . THIS LAND WAS SUBSEQUENTLY SOLD TO A COMPANY BY THE NAME ESTRA IT PARK PVT. LTD, FOR A TOTAL CONSIDERATION OF , VIDE SALE DEED DATED 24.1.2007. IN THE SALE DEED, IT IS D IN PARA 3 THAT THE ASSESSEE IS COMPELLED TO SELL THE PROPERTY AS AT PRESENT IT IS NOT FETCHING ANY INCOME. THE ISSUE INVOLVED BEFORE US IS AS TO WHETHER THE LAND SOLD IS AGRICULTURAL LAND OR IT IS TO BE TREATED AS A CAPITAL ASSET IN THE TERMS OF SECTION 2(14) OF THE ACT. IT IS TRUE THAT THE DEFINITION OF AGRICULTURAL LAND IS NOT GIVEN IN THE INCOME - TAX ACT, BUT VARIOUS FACTORS CONTRIBUTE TO ASCERTAIN THE CORRECT NATURE OF A PARTICULAR PIECE OF LAND. IF A LAND IS SITUATED WITHIN 8 KMS OF THE MUNICIPAL LIMI TS OF A CITY EVEN IF IT IS RECORDED AS AGRICULTURAL LAND IN THE REVENUE RECORDS, IT IS TO BE TREATED AS AGRICULTURAL LAND AND FOR THAT MATTER AN ASSET BUT IN THIS CASE, THE ADMITTED FACT IS THAT THIS LAND FALLS BEYOND 8 KMS FROM THE NOTIFIED LIMIT. IT TRUE THAT AS PER REVENUE RECORDS, THE LAND HAS BEEN RECORDED AS AGRICULTURAL LAND. IT IS FOUND TO BE A FACT THAT THE ASSESSEE HAS BEEN SHOWING AGRICULTURAL INCOME FROM THIS VERY LAND AND THE SAME HAS BEEN ACCEPTED BY THE REVENUE THE LAND WAS PURCHASED BY THE ASSESSEE AND AT THAT TIME IT WAS LOW LYING AS SOME MUD WAS TAKEN FROM IT FOR MAKING BRICKS ETC. BUT ADMITTEDLY AFTER PURCHASE, NO SUCH ACTIVITY WAS CARRIED OUT ON THIS LAND. EVEN IF WE ACCEPT THE CONTENTION OF THE REVENUE THA T NO AGRICULTURAL PRODUCTION WAS DONE BY THE ASSESSEE ON THIS LAND, THIS MERE FACT WILL NOT TAKE OUT THE LAND OUT OF THE NOMENCLATURE OF AGRICULTURAL LAND. THE ASSESSEE GROWS COCONUT ON THIS LAND AND THE SAME ARE SOLD IN THE MARKET AND THESE RECEIPTS ARE TREATED AS AGRICULTURAL RECEIPTS BY THE REVENUE. THE ASSESSEE HAS ALSO PAID AGRICULTURAL LAND TAX AND COPIES OF THE SAME WERE MADE AVAILABLE TO THE AUTHORITIES. THE LAND IN QUESTION IS SITUATED IN THE REVENUE ESTATE OF A VILLAGE NAMED IYYAPPANTHANGAL HAYAT WHICH IS SITUATED MORE THAN 8 KMS AWAY FROM THE LIMITS OF ALANDUR MUNICIPALITY. WE HAVE FOUND THAT THE LAND HAS BEEN AGRICULTURAL LAND FOR THE PAST MANY YEARS AND HAS BEEN CLASSIFIED AS SUCH IN THE RECORDS OF THE REVENUE DEPARTMENT. THE ASSESSEE HAS PAID KIST OF `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{SC SPS} C OPY OF THE ORDER FORWARDED TO: 1. SANJEEV KUMAR GOYAL 45-B, ADHYA SRADHA GHAT ROAD KOLKATA 700 007 2. INCOME TAX OFFICER, WARD- 45(2), KOLKATA 3. CIT(A)- 4. CIT- , 5. CIT(DR), KOLKATA BENCHES, KOLKATA. 24 VIJAY KUMAR SHARDA VS. DCIT [2013] 40 TAXMANN.COM 113 (MUM TRIB) MUKESH BABULAL RACHH VS. ITO IN ITA NO. 6066/MUM/2018 ITO VS. BISWAJIT CHATTERJEE ITA NO. 565/KOL/2013 CONSISTENT WITH THE VIEW TAKEN THEREIN, WE QUASH THE DIRECTIONS GIVEN BY THE LD. CIT(A) TO THE ASSESSING OFFICER TO REOPEN THE ASSESSMENT OF THE PARTNERSHIP FIRM M/S. SHREE ANNAPURNA OIL MILLS AND TO TAX THE LONG TERM CA PITAL GAIN IN QUESTION IN THE HANDS OF THE FIRM. HENCE GROUND NO. 7 OF THE ASSESSEE IS ALLOWED. GROUND NO. 8, IN GENERAL IN NATURE. IN THE RESULT, APPEAL OF THE ASSESSEE IS ALLOWED. KOLKATA, THE 29 TH DAY OF OCTOBER, 2019. [ J. SUDHAKAR REDDY ACCOUNTANT OPY OF THE ORDER FORWARDED TO: ADHYA SRADHA GHAT ROAD 45(2), KOLKATA 5. CIT(DR), KOLKATA BENCHES, KOLKATA. TRUE COPY BY ORDER ASSISTANT REGISTRAR ITAT, KOLKATA BENCHES I.T.A. NO. 981/KOL/2018 ASSESSMENT YEAR: 2011-12 SANJEEV KUMAR GOYAL VIJAY KUMAR SHARDA VS. DCIT [2013] 40 TAXMANN.COM 113 (MUM TRIB) MUKESH BABULAL RACHH VS. ITO IN ITA NO. 6066/MUM/2018 CONSISTENT WITH THE VIEW TAKEN THEREIN, WE QUASH THE DIRECTIONS GIVEN BY THE LD. CIT(A) TO THE ASSESSING OFFICER TO REOPEN THE ASSESSMENT OF THE PARTNERSHIP FIRM M/S. PITAL GAIN IN QUESTION IN THE HANDS SD/- J. SUDHAKAR REDDY ] ACCOUNTANT MEMBER TRUE COPY BY ORDER ASSISTANT REGISTRAR ITAT, KOLKATA BENCHES