DCIT-CC-2(1), AHMEDABAD, AHMEDABAD vs. VEDPRAKASH DEVKINANDAN CHIRIPAL, AHMEDABAD
Income Tax Appellate Tribunal, “C” BENCH, AHMEDABAD
Before: DR. B.R.R. KUMAR, VICE-SHRI SIDDHARTHA NAUTIYAL
PER DR. B.R.R. KUMAR, VICE-PRESIDENT:-
Delay condoned
This appeal is filed by the Revenue against the appellate order dated
12.12.2023 passed by the Commissioner of Income Tax (Appeals)-12,
Ahmedabad, relating to the Assessment Year 2017-18. 2. The Revenue has raised the following grounds of appeals:
Whether on the facts and in the circumstances of the case and in law, the Ld. CIT(A) is correct in deleing the addition on account of short term capital gain of Rs.3,54,83,557/- without considering the observation of AO that the land is to be used for Industrial purpose and are deemed non-agricultural land.
Whether on the facts and in the circumstances of the case and in law, the Ld. Asst. Year : 2017-18 - 2– 3. On the facts and in the circumstances of the case and in law, the ld. CIT(A) ought to have upheld the order of the AO.
It is therefore, prayed that the order of the Ld. CIT(A) be set aside and that of the AO be restored to the above extent.
Addition on account of short-term capital gains of Rs. 3,54,83,557/-
Pertinent facts relevant for adjudication of the case are that,
The assessee sold 8 pieces of land situated beyond 8 kms of the municipal limits being situated in Dholka, Ahmedabad (6 pieces) and Bidaj. Kheda (2 pieces).
The Assessing Officer held that the assessee is a non-agriculturist and he purchased these pieces of land from the original agriculturists at various time within a period of 30 months and then sold to different companies against the fact on record that the assessee is an agriculturist. The details of the same are as under:-
1 The purchase of these pieces of land have been accepted by the State as the subsequent sales are duly registered. The Assessing Officer held that the assessee has purchased agricultural lands and sold them for a profit and hence the profit earned from sale of non-agricultural land be treated as short-term capital gains. No. Particular of Land Block No. Area Hectares Date Purchase Purchase Cos Date of Sales Sales Consideratio Profit Amoun Duration (months) i. Roopgadh 359/2 1-67-14 04/01/2016 17,73,223 12/07/2016 48,16,000 30,42,777 6.25 ii. Roopgadh 358 3-21-05 12/02/2016 32,06,751 12/07/2016 91,50,000 59,43,249 4.96 iii. Roopgadh 352 2-22-58 30/11/2015 23,02,573 21/10/2016 63,45,000 40,42,427 10.72 iv. Roopgadh 357A-7 1-67-95 10/09/2015 17,21,468 21/10/2016 48,50,000 31,28,532 13.38 v. Roopgadh 353 2-83-28 30/11/2015 28,84,628 21/10/2016 80,75,000 51,90,372 10.72 vi Roopgadh 357A-12 5-20-02 21/08/2015 52,76,416 02/12/2016 145,00,000 92,23,584 15.42 vii Bidaj 749 0-10-12 08/01/2025 4,96,570 28/03/2017 12,90,000 7,93,430 26.63 viii Bidaj 764 0-50-59 11/09/2015 23,05,814 28/03/2017 64,25,000 41,19,186 18.54 1,99,67,443 5,54,51,000 3,54,83,557 Asst. Year : 2017-18 - 3– The Ld. CIT(A) held that the land sold was agricultural land and hence no capital gains arise. Aggrieved, the Revenue filed appeal before us.
Having gone through the entire record and after hearing the arguments of both the parties who relied on the orders of the Ld. CIT(A) and the Assessing Officer to their favour, we find that,
• The assessee purchased agricultural lands registered in his name. This proves that the assessee is an agriculturist though he has not earned any agricultural income in earlier years.
• The land at the time of purchase was agricultural in nature as per the land records.
• The Sale Deeds submitted by the assessee records that the land is agricultural land and the same was subsequently sold for industrial purpose which led to the question whether the agricultural land purchased and sold by the assessee can be treated as non-agricultural in nature and the profits thereof can be taxed or not.
• We find that transfer u/s 63(AA) is conditional and has to be converted into non-agricultural land within 90 days and if not converted, the sale deed automatically gets cancelled.
• Ld. CIT(A) held that at the point of sale by the assessee of the land, the land remained agricultural in nature and it was the purchaser who has to apply for conversion of the land into non-agricultural land before the State
Government.
• It also stipulates that failure to convert the land to non-agriculture would lead to cancellation of the sale deed.
Asst. Year : 2017-18
- 4–
• Thus, it can be found that the assessee has purchased agricultural land and sold agricultural land which has been subsequently converted into non- agricultural land by the purchaser which does not ipso facto make the agricultural land sold by the assessee as the non-agricultural land.
• Hence, we decline to interfere with the well-reasoned order of the Ld.
CIT(A).
In the result, the appeal of the Revenue is dismissed.
Order is pronounced in the open Court on 29.05.2025 (SIDDHARTHA NAUTIYAL)
VICE-PRESIDENT
Ahmedabad; Dated 29.05.2025
MV/BT
आदेश की ितिलिप अ ेिषत/Copy of the Order forwarded to :
अपीलाथ / The Appellant 2. थ / The Respondent. 3. संबंिधतआयकरआयु / Concerned CIT 4. आयकरआयु(अपील) / The CIT(A)- 5. िवभागीयितिनिध, आयकरअपीलीयअिधकरण, अहमदाबाद/ DR, ITAT, Ahmedabad 6. गाड फाईल/ Guard file.
आदेशानुसार/ BY ORDER,सहायक पंजीकार (Dy./Asstt.