THE MANNARGHAT RUBBER ESTATES PVT LTD,PALGHAT vs. THE ACIT CIRCLE 1, PALAKKAD

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ITA 297/COCH/2023Status: DisposedITAT Cochin23 October 2024AY 2013-14Bench: Shri Satbeer Singh Godara (Judicial Member), Shri Amarjit Singh (Accountant Member)3 pages
AI SummaryPartly Allowed

What did the Tribunal hold?

The Tribunal held that the assessee could not be considered to have engaged in land trading activities in AY 2013-14 due to a lack of evidence of land sale. However, for AY 2015-16, the sale of lands after plotting was accepted as a factual position.

What were the facts?

The assessee company's appeals challenged the tax authorities' treatment of sale proceeds from agricultural land as business income. The Tribunal noted that for AY 2013-14, there was no indication of the sale of agricultural land, while for AY 2015-16, the sale and plotting of lands were established.

What were the issues?

Whether the sale of agricultural land constitutes business income or capital gains. The distinction between agricultural land and land used for trading activities.

Which sections of the Income-tax Act were involved?

Section 250

AI-generated summary — verify with the full judgment below

Income Tax Appellate Tribunal, COCHIN BENCH, COCHIN

Before: Shri Satbeer Singh Godara & Shri Amarjit Singh

For Appellant: Shri Adithya Unnikrishnan, CA
For Respondent: Smt. V. Swarnalatha, Sr. D.R
Hearing: 22.08.2024Pronounced: 23.10.2024

O R D E R Per Bench These assessee’s twin appeals & 298/Coch/2023, arise against orders of the National Faceless Appeal Centre , Delhi [CIT(A)] in proceedings u/s. 250 of the Income Tax Act, 1961 (the Act) as under : - DIN & Order No. Date No. 1 297/Coch/2023 2013-14 ITBA/NFAC/S/250/2022- 27.02.2023 23/1050151652(1) 2 298/Coch/2023 2015-16 ITBA/NFAC/S/250/2022- 27.02.2023 23/1050151807(1)

Heard both the parties. Case files perused.

& 298/Coch/2023 Mannarghat Rubber Estates P. Ltd. 2. It emerges during the course of hearing that the assessee’s identical sole substantive ground placed in both these appeals challenge the lower authorities action treating its sale proceeds from transfer of “agricultural land” as business income thereby holding that it had taken a plunge in adventure in land trading activities.

3.

Learned Sr. DR refers to the para 4 of the assessment order in former AY 2013-14 and para 3.3 of the latter assessment; respectively that the assessee has been rightly assessed for its impugned business income.

4.

We note in this factual backdrop that there is no indication in the former AY 2013-14 before us that the assessee has sold/transferred its agricultural land. We are of the considered view therefore that the assessee could not be held to have engaged in any adventure or business in land dealings in AY 2013-14. The factual position is the opposite in the latter AY 2015-16 it has been found that the assessee had sold/transferred its lands after due plotting as per the assessment order. Learned counsel indeed very fair in not being able to rebut all the relevant facts to this clinching effect.

5.

Faced with this situation, we allow the assessee’s former appeal ITA 297/Coch/2023 for AY 2013-14 and dismiss the latter case ITA 299/Coch/2023 for AY 2015-16 in very terms. A copy of this common order be placed in the respective case files.

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