KAMLESHBHAI MANUBHAI PATEL,VADODARA vs. THE DY.CIT, CIRCLE-1(1)(1), VADODARA

ITA 814/AHD/2025Status: DisposedITAT Ahmedabad05 February 2026AY 2012-13Bench: SHRI TR SENTHIL KUMAR (Judicial Member), SHRI NARENDRA PRASAD SINHA (Accountant Member)10 pages
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What did the Tribunal hold?

The Tribunal held that the gain on sale of land was to be treated as capital gains, not business income. However, the application of Section 50C was incorrect as it should have considered the stamp duty value on the date of the agreement (banakhat), not the sale deed.

What were the facts?

The assessee sold land for Rs. 35 Lakhs, declaring the gain as business income. The AO treated it as capital gains, applying Section 50C based on the stamp duty value of Rs. 1.37 crores. The AO also disallowed interest deductions claimed under business income.

What were the issues?

Whether the gain on sale of land is business income or capital gains, and the correct application of Section 50C for determining the sale consideration.

Which sections of the Income-tax Act were involved?

Section 50C,Section 143(3)

AI-generated summary — verify with the full judgment below

Income Tax Appellate Tribunal, “B” BENCH, AHMEDABAD

Before: SHRI TR SENTHIL KUMAR & SHRI NARENDRA PRASAD SINHA

For Appellant: Shri Deepak Shah, AR
For Respondent: Shri Abhijit, Sr. D.R
Hearing: 22.01.2026Pronounced: 05.02.2026

PER NARENDRA PRASAD SINHA, ACCOUNTANT MEMBER:

This appeal is filed by the assessee against the order of National Faceless Appeal Centre(NFAC), Delhi [hereinafter referred to as ‘CIT(A)’], dated 28.03.2025 for the Assessment Year (A.Y.) 2012-13 in the proceeding u/s 143(3) of the Income Tax Act.

2.

The brief facts of the case are that the assessee had filed his return of income for A.Y. 2012-13 on 30.07.2011 declaring total income of Rs. 85,860/-. The case was taken up for scrutiny. In the course of assessment, the AO found that the assessee had purchased a piece of land on 21.01.2011 at a cost of Rs.30 Lakhs, which was sold on 24.11.2011 for a Kamleshbhai Manubhai Pa

The order continues below.

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