Raja J. Rameshwar Rao v. CIT

42 ITR 179Supreme Court of India1961#2131 most cited

What is Raja J. Rameshwar Rao v. CIT authority for?

A transaction, even if appearing to be in the capital field or recorded as such, can constitute an 'adventure in the nature of trade,' leading to taxable income from business rather than capital gains.

54

judgments rely on this decision, according to BharatTax’s citation analysis of 366,470 Indian tax judgments — from 2015 to 2026.

Also referred to as

Raja J. Rameshwar Rao · 42 ITR 179 · adventure in the nature of trade · business income · capital gains · section 45 · recharacterization of income · capital asset · profit from transaction · trade vs investment

Sections most often in play

Section 143(3)Section 147Section 48Section 131Section 133(6)Section 148Section 44ADSection 45

Issues it is cited on

section 45(1)transfer of capital assetsection 45section 149(1)(b)section 2(14)kelvinatorsection 22section 2(15)short term capital gainadmission of additional evidencesection 44adchange of opinion

Judgments citing Raja J. Rameshwar Rao v. CIT

The ACIT, Trichur vs. Sri.Arun Majeed, Thrissur

In the result, the appeals of the Revenue are dismissed

ITA 494/COCH/2018[2011-12]Status: DisposedITAT Cochin06 Feb 2019AY 2011-12

Bench: S/Shri Chandra Poojari, Am & George George K., Jm

Section 132Section 143(3)Section 153A

…elling the same to different persons would amount to adventure in the nature of trade and the profit on sale of land was to be assessed as income from business. The Assessing officer also relied on the judgments of the Apex Court in Raja J Rameswar Rao V CIT (42 ITR 179), Indramani Bai & Another vs. Addl CIT (200 ITR 594) and in G. Venkataswami Naidu & Co. vs. CIT (35 ITR 594). On appeal filed by the Assessee, the CIT (A) allowed the claim of the assessee. On appeal by the Dept. before ITAT, the Tribunal held that "to consider the transaction as I.T.A. Nos.494 - 497/Coch/2018 business transaction, the intentio…

Asst CIT 19(3), Mumbai vs. Rahul Premnath Bhatia, Mumbai

In the result, appeal of the Revenue is dismissed

ITA 1319/MUM/2016[2011-12]Status: DisposedITAT Mumbai09 Oct 2018AY 2011-12

Bench: Shri R.C.Sharma, Am & Shri Ram Lal Negi, Jm Asst. Cit 19(3) Vs. Shri Rahul Premnath Bhatia Matru Mandir, 9, Ashiana Building 2Nd Floor, R.No.206 5, Altamount Road Tardeo Road, Mumbai – 400 026 Mumbai – 400 007 Pan/Gir No. Aadpb0626L (Appellant) .. (Respondent)

Section 10(38)Section 143(3)Section 14A

…this court cautioned that it did not accept these badges as comprehensive or exhaustive but thought that they were of considerable assistance in deciding the character of a transaction as of a commercial character. 6.4.14 In Raja J Rameshwar Rao Vs CIT [1961] 42 ITR 179, the Supreme Court observed as under (headnote) : "Even a single venture may be regarded as in the nature of trade or business When a person acquires land with a view to selling it later after developing it, he is carrying on an activity resulting in profit, and the activity can only be described as a business venture Where the person goes furthe…

K.Shanthi, Coimbatore vs. ACIT, Coimbatore

ITA 433/CHNY/2017[2012-13]Status: DisposedITAT Chennai02 Feb 2018AY 2012-13

Bench: Shri Abraham P. George & Shri Duvvuru Rl Reddy]

For Appellant: Shri. T. Banusekar, C.AFor Respondent: Mrs. Vijayaprabha, IRS, JCIT
Section 2(14)Section 234ASection 54B

…d. Authorised Representative was that there was nothing on record to show any non agricultural operation being carried out either by the assessee or by the purchaser. Relying on the judgment of Hn’ble Apex Court in the case of Raja J. Rameshwar, Rao vs. CIT 42 ITR 179, ld. Authorised Representative submitted that without demonstrating sufficient proof to show non agricultural use, a dry land could not be classified as non agricultural land. On the question of the nature of the two pieces land 12. acquired by the assessee based on which the claim u/s.54B of the Act was preferred, ld. Authorised Representativ…

M/S Gurpreet Thukral, New Delhi vs. ACIT, New Delhi

In the result, the appeal of the assessee is partly allowed

ITA 2441/DEL/2017[2011-12]Status: DisposedITAT Delhi16 Oct 2017AY 2011-12

Bench: Shri B.P. Jain

For Appellant: Shri Arun Kishore, CAFor Respondent: Shri T. Vasanthan Sr. DR
Section 37Section 44A

…tion of purchase and resale is an adventure in the nature trade. If there are relevant facts besides the fact of purchase and resale, it is open to come to the conclusion that the transaction is one in the nature of trade.” Raja J. Rameshwar Rao v CIT (1961) 42 ITR 179 (SO- “The activity of an assessee in dividing the land into plots and not selling it as a single unit as he purchased, goes to establish that he was carrying on business in real property o.nd it is a business venture.” CIT v Trivedi (V.A.i (1 988) 1 72 ITR 95 (Bom) “Ordinarily, where a person acquired land with a view to selling it later after…

S.M.Noorudheen Shajahan, Coimbatore vs. JCIT, Coimbatore

In the result, the appeal filed by the assessee is dismissed

ITA 256/CHNY/2016[2011-2012]Status: DisposedITAT Chennai13 Oct 2017AY 2011-2012

Bench: Shri Sanjay Arora & Shri Duvvuru Rl Reddyआयकर अपील सं./I.T.A.No.256/Mds/2016 "नधा"रण वष"/Assessment Year:2011-12 Shri S.M. Noorudheen Shajahan, The Joint Commissioner Of No. 25A-4/1, Ami Mid Town, Vs. Income Tax, Range Iii, D.B. Road, R.S. Puram, Coimbatore 641 018. Coimbatore 641 002. [Pan:Abcpn6465F] (अपीलाथ" /Appellant) (""यथ"/Respondent) अपीलाथ" क" ओर से / Appellant By : Shri S. Sridhar, Advocate ""यथ" क" ओर से/Respondent By : Shri Ashish Tripathi, Jcit सुनवाई क" तार"ख/ Date Of Hearing : 26.07.2017 घोषणा क" तार"ख /Date Of Pronouncement : 13.10.2017 आदेश /O R D E R Per Bench: This Appeal Filed By The Assessee Is Directed Against The Order Of The Ld. Commissioner Of Income Tax (Appeals) 1, Coimbatore, Dated 16.11.2015 Relevant To The Assessment Year 2011-12, Wherein, The Only Effective Ground Raised In The Appeal Is That The Ld. Cit(A) Has Erred In Confirming The Addition Of ₹.43,90,810/- From Sale Of Lands Treating The Same As Business Income.

For Appellant: Shri S. Sridhar, AdvocateFor Respondent: Shri Ashish Tripathi, JCIT
Section 143(1)Section 143(2)Section 54F

…cted the claim of exemption under section 54F of the Act. 3. The assessee carried the matter in appeal before the ld. CIT(A). Considering the facts and circumstances of the case and by following the decision in the case of Raja J. Rameshwar Rao v. CIT [1961] 42 ITR 179 (SC), the ld. CIT(A) dismissed the appeal filed by the assessee. 4. On being aggrieved, the assessee is in appeal before the Tribunal. The ld. Counsel for the assessee has submitted that the income out of the sale of land was only a capital gain and it cannot be treated as adventure in the nature of trade. Further, the assessee has disclosed the…

Shri Chandrabhan Singh Choudhary, Chhindwara vs. The DCIT 1(2), Bhopal

In the result, the appeal of the Assessee is partly allowed on ground no

ITA 170/IND/2014[2008-09]Status: DisposedITAT Indore31 Mar 2017AY 2008-09

Bench: Shri Chandra Mohan Garg & Shri O.P.Meenaassessment Year: 2008-09

Section 143(3)Section 54F

…s offered to tax by the assessee under the wrong head. The Ld. DR placing reliance on the decision of Hon’ble High Court of Madhya Pradesh in the case of CIT v. Suresh Chand Goyal, decision in Hon’ble Supreme Court in the case of Raja J. Rameshwar Rao vs. CIT 42 ITR 179 (SC) & decision of Hon’ble Karnataka High Court in case of CIT vs. B. Narasimha Reddy 150 ITR 347(Kar) submitted that when land is situated in a village, but located within the urbanized area and kept it uncultivated for several years and 7 Shri Chandrabhan Singh Choudhary after obtaining permission to convert the land for non- agricultural purpo…

M/S. Chandra Prakash Goel, New Delhi vs. ITO, Hapur

In the result, the appeal is allowed partly for statistical purpose

ITA 3032/DEL/2014[2010-11]Status: DisposedITAT Delhi20 Mar 2017AY 2010-11

Bench: Sh. Amit Shukla & Sh. O.P. Kantassessment Year: 2010-11 Vs. Income Tax Officer, Ward-1, Sh. Chandra Prakash Goel, C/O- M/S. Rra Taxindia, D-28, South Hapur Extension, Part-I, New Delhi Pan : Aatpg4288R (Appellant) (Respondent) Appellant By Dr. Rakesh Gupta & Sh. Somil Agarwal, Advocates Respondent By Sh. Anil Kumar Sharma, Sr.Dr Date Of Hearing 02.03.2017 Date Of Pronouncement 20.03.2017 Order Per O.P. Kant, A.M.: This Appeal By The Assessee Is Directed Against Order Dated 17/02/2014 Of Learned Commissioner Of Income-Tax (Appeals), Ghaziabad For Assessment Year 2010-11, Raising Following Grounds:

Section 143(2)Section 143(3)Section 234A

…nder rule 46A of the Income Tax Rules, 1962 was made before him. The Ld. Commissioner of Income Tax (Appeals) confirmed the action of the Assessing Officer relying on the judgment of the Hon’ble Supreme Court in the case of Raja J Rameshwar Rao Vs. CIT (1961) 42 ITR 179(SC) . He referred the observation of the Hon’ble Supreme Court that “where a person goes further and divides the land into plots, develops the area to make it more attractive and sells the land not as a single unit and as he bought but in parcels, he is dealing with land as his a stock in trade; he is carrying on business and making a profit …...”…

Sanjay J Ahuja, Mumbai vs. ITO 19(3)(4), Mumbai

In the result, the appeal filed by the assessee is allowed

ITA 5731/MUM/2014[2010-11]Status: DisposedITAT Mumbai09 Dec 2016AY 2010-11

Bench: Shri B.R.Baskaran & Shri Ramlal Negishri Sanjay J. Ahuja, 202, Flat No.11, Shahnaj Building, New New India Bank, S.V.Road, Bandra (West), Mumbai 400 050 Pan:Adepa 2739H ...... Appellant Vs. The Income Tax Officer 19(3)(4), Piramal Chambers, Parel Mumbai 400 011 .... Respondent

For Appellant: Shri Haridas BhatFor Respondent: Shri A.K.Kardam
Section 50C

…the facts and circumstances in the case, the Court may, despite the said initial intention, be inclined to hold that the transaction was not an adventure in the nature of trade. The presumption may be rebutted." Again, in Raja J. Rameshwar Rao vs. CIT (1961) 42 ITR 179 (SC) it was ruled (headnote) : "Even a single venture may be regarded as in the nature of trade or business. When a person acquires land with a view to selling it later after developing it, he is carrying on an activity resulting in profit, and the activity can only be described as a business venture. Where the person goes further and divides the…

DCIT, Tambaram vs. R.Vsanthi Ram Narayan, Chennai

In the result, all the appeals of the Revenue and cross- objections of the assessee stand dismissed

ITA 1806/CHNY/2015[2011-12]Status: DisposedITAT Chennai18 Dec 2015AY 2011-12

Bench: Shri N.R.S. Ganesan & Shri A. Mohan Alankamonyआयकर अपील सं./Ita Nos.1802 & 1803/Mds/2015 & C.O. Nos.114 & 115/Mds/2015 (In I.T.A. Nos.1802 & 1803/Mds/2015) "नधा"रण वष" / Assessment Years : 2008-09 & 2009-10

For Appellant: Sh. P. Radhakrishnan, JCIT
Section 148

…different persons would amount to adventure in the nature of land, therefore, the profit on sale of land was taken as income from business by the Assessing Officer. The Assessing Officer by applying the judgments of Apex Court in Raja J. Rameswar Rao v. CIT (42 ITR 179), Indramani Bai & Another v. Addl. CIT (200 ITR 594) and in G. Venkataswami Naidu & Co. v. CIT (35 ITR 594), found that the profit on sale of land has to be treated as business income. Accordingly, he rejected the claim of the assessee to assess the income on sale of land as long term capital gain. However, on appeal by the assessee, the CIT(A…

DCIT, Tambaram vs. R.Vsanthi Ram Narayan, Chennai

In the result, all the appeals of the Revenue and cross- objections of the assessee stand dismissed

ITA 1805/CHNY/2015[2009-10]Status: DisposedITAT Chennai18 Dec 2015AY 2009-10

Bench: Shri N.R.S. Ganesan & Shri A. Mohan Alankamonyआयकर अपील सं./Ita Nos.1802 & 1803/Mds/2015 & C.O. Nos.114 & 115/Mds/2015 (In I.T.A. Nos.1802 & 1803/Mds/2015) "नधा"रण वष" / Assessment Years : 2008-09 & 2009-10

For Appellant: Sh. P. Radhakrishnan, JCIT
Section 148

…different persons would amount to adventure in the nature of land, therefore, the profit on sale of land was taken as income from business by the Assessing Officer. The Assessing Officer by applying the judgments of Apex Court in Raja J. Rameswar Rao v. CIT (42 ITR 179), Indramani Bai & Another v. Addl. CIT (200 ITR 594) and in G. Venkataswami Naidu & Co. v. CIT (35 ITR 594), found that the profit on sale of land has to be treated as business income. Accordingly, he rejected the claim of the assessee to assess the income on sale of land as long term capital gain. However, on appeal by the assessee, the CIT(A…

DCIT, Tambaram vs. R.Vasanthi Ram Narayan, Chennai

In the result, all the appeals of the Revenue and cross- objections of the assessee stand dismissed

ITA 1804/CHNY/2015[2008-09]Status: DisposedITAT Chennai18 Dec 2015AY 2008-09

Bench: Shri N.R.S. Ganesan & Shri A. Mohan Alankamonyआयकर अपील सं./Ita Nos.1802 & 1803/Mds/2015 & C.O. Nos.114 & 115/Mds/2015 (In I.T.A. Nos.1802 & 1803/Mds/2015) "नधा"रण वष" / Assessment Years : 2008-09 & 2009-10

For Appellant: Sh. P. Radhakrishnan, JCIT
Section 148

…different persons would amount to adventure in the nature of land, therefore, the profit on sale of land was taken as income from business by the Assessing Officer. The Assessing Officer by applying the judgments of Apex Court in Raja J. Rameswar Rao v. CIT (42 ITR 179), Indramani Bai & Another v. Addl. CIT (200 ITR 594) and in G. Venkataswami Naidu & Co. v. CIT (35 ITR 594), found that the profit on sale of land has to be treated as business income. Accordingly, he rejected the claim of the assessee to assess the income on sale of land as long term capital gain. However, on appeal by the assessee, the CIT(A…

DCIT, Tambaram vs. Shridi Estates, Chennai

In the result, all the appeals of the Revenue and cross- objections of the assessee stand dismissed

ITA 1803/CHNY/2015[2009-10]Status: DisposedITAT Chennai18 Dec 2015AY 2009-10

Bench: Shri N.R.S. Ganesan & Shri A. Mohan Alankamonyआयकर अपील सं./Ita Nos.1802 & 1803/Mds/2015 & C.O. Nos.114 & 115/Mds/2015 (In I.T.A. Nos.1802 & 1803/Mds/2015) "नधा"रण वष" / Assessment Years : 2008-09 & 2009-10

For Appellant: Sh. P. Radhakrishnan, JCIT
Section 148

…different persons would amount to adventure in the nature of land, therefore, the profit on sale of land was taken as income from business by the Assessing Officer. The Assessing Officer by applying the judgments of Apex Court in Raja J. Rameswar Rao v. CIT (42 ITR 179), Indramani Bai & Another v. Addl. CIT (200 ITR 594) and in G. Venkataswami Naidu & Co. v. CIT (35 ITR 594), found that the profit on sale of land has to be treated as business income. Accordingly, he rejected the claim of the assessee to assess the income on sale of land as long term capital gain. However, on appeal by the assessee, the CIT(A…

DCIT, Tambaram vs. Shridi Estates, Chennai

In the result, all the appeals of the Revenue and cross- objections of the assessee stand dismissed

ITA 1802/CHNY/2015[2008-09]Status: DisposedITAT Chennai18 Dec 2015AY 2008-09

Bench: Shri N.R.S. Ganesan & Shri A. Mohan Alankamonyआयकर अपील सं./Ita Nos.1802 & 1803/Mds/2015 & C.O. Nos.114 & 115/Mds/2015 (In I.T.A. Nos.1802 & 1803/Mds/2015) "नधा"रण वष" / Assessment Years : 2008-09 & 2009-10

For Appellant: Sh. P. Radhakrishnan, JCIT
Section 148

…different persons would amount to adventure in the nature of land, therefore, the profit on sale of land was taken as income from business by the Assessing Officer. The Assessing Officer by applying the judgments of Apex Court in Raja J. Rameswar Rao v. CIT (42 ITR 179), Indramani Bai & Another v. Addl. CIT (200 ITR 594) and in G. Venkataswami Naidu & Co. v. CIT (35 ITR 594), found that the profit on sale of land has to be treated as business income. Accordingly, he rejected the claim of the assessee to assess the income on sale of land as long term capital gain. However, on appeal by the assessee, the CIT(A…

Krishan Kumar Saraf, Bhiwani vs. CIT, Hisar

In the result, assessee’s appeal is allowed

ITA 4562/DEL/2011[2007-08]Status: DisposedITAT Delhi24 Sept 2015AY 2007-08

Bench: Shri S.V. Mehrotra : & Ms. Suchitra Kamble :Asstt. Yr: 2007-08 Krishan Kumar Saraf, Vs. Commissioner Of Income-Tax, S/0 Sh. Brij Lal Saraf, Hissar. Bichla Bazar, Near City Police Stationj, Bhiwani. Pan: Amqps 3147J ( Appellant ) (Respondent) Appellant By : Shri N.K. Jain Adv. Respondent By : Ms. Sulekha Verma Cit (Dr) Date Of Hearing : 07/09/2015. Date Of Order : 24/09/2015. O R D E R

For Appellant: Shri N.K. Jain AdvFor Respondent: Ms. Sulekha Verma CIT (DR)
Section 143(2)Section 143(3)Section 263Section 263(1)Section 69

…n at Rs.22,62,575/- from this transaction. In view of Punjab & Haryana High Court's decision in the case of Harbans Singh Vs. CIT Amritsar-I (132 ITR 77 & 23 CTR 335) and Supreme Court's decision in the case of Raja J. Rarneshwar Rao Vs. CIT Hydrabad cited in 42 ITR 179), the income earned from the transaction of purchasing plot of lands, constructing shops thereon and selling those shops should have been treated as business income instead of Long Term Capital Gain, but the A.O. failed to do so and without scrutinizing the issue accepted Long Term Capital gain as claimed by the assessee. iii. Further, the assesse…