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2017 (3) TMI 1311 - AT - Income TaxLong Term Capital Gain - nature of land - Held that - Appellant had declared agricultural income in earlier years and the same has been accepted by the department also; Sale deed produced by the assessee clearly shows that the land sold is an agricultural land and Tehsildar certificate was also produced by the assessee confirming the fact that land is beyond 8 kms from the outer limit of Municipal Corporation. It is case where assessee has submitted all the information and evidences in support of its contention and these evidences also stand confirmed by the independent enquiry by the AO even in the remand proceedings and there is nothing adverse hence the action of the ld. CIT(A) in deleting the addition in dispute is correct one which does not need any interference on our part. Therefore in the background of the aforesaid detailed discussions we are of the view that Ld. CIT(A) has passed a well reasoned order hence we uphold the same. Accordingly the grounds raised by the Revenue stands dismissed.
Issues Involved:
1. Deletion of addition on account of Long Term Capital Gain. 2. Admission of additional evidence by CIT(A). Issue-wise Detailed Analysis: 1. Deletion of Addition on Account of Long Term Capital Gain: Background and Facts: - The assessee, an individual, filed a return for the assessment year 2009-10 declaring a total income of ?35,62,070/-. The Assessing Officer (AO) assessed the total income at ?5,24,16,940/- after adding ?4,88,38,251/- as Long Term Capital Gain from the sale of agricultural land. - The AO contended that the land sold by the assessee was a capital asset and thus liable for capital gains tax. Assessee's Argument: - The assessee argued that the land sold was agricultural and situated beyond 8 kilometers from the municipal limits, thus not falling within the definition of a capital asset under Section 2(14) of the Income Tax Act. - The assessee provided multiple certificates and evidence, including a certificate from the Tehsildar, Gurgaon, confirming the distance of the land from the municipal limits. CIT(A)'s Findings: - The CIT(A) admitted the additional evidence under Rule 46A and verified the certificate from the Tehsildar, confirming the land's distance from the municipal limits. - The CIT(A) concluded that the land sold was agricultural, not a capital asset, and thus exempt from capital gains tax. The CIT(A) directed the AO to delete the addition of ?4,88,38,251/-. Tribunal's Decision: - The Tribunal upheld the CIT(A)'s decision, agreeing that the land was agricultural and situated beyond 8 kilometers from the municipal limits. - The Tribunal noted that the AO's remand report did not provide any adverse findings against the evidence submitted by the assessee. - The Tribunal confirmed that the CIT(A) had passed a well-reasoned order and dismissed the Revenue's appeal. 2. Admission of Additional Evidence by CIT(A): Background and Facts: - During the appellate proceedings, the assessee submitted additional evidence, including a certificate from the Tehsildar, Gurgaon, which was not produced before the AO during the assessment proceedings. Assessee's Argument: - The assessee argued that the additional evidence was crucial for determining the nature of the land and was prevented by sufficient cause from producing it earlier. CIT(A)'s Findings: - The CIT(A) admitted the additional evidence under Rule 46A, finding it essential for deciding the matter. - The CIT(A) conducted a thorough verification of the additional evidence and found it to be genuine and relevant. Tribunal's Decision: - The Tribunal agreed with the CIT(A)'s decision to admit the additional evidence, noting that it was crucial for determining whether the land was a capital asset. - The Tribunal found that the CIT(A) had followed due process in admitting and verifying the additional evidence. - The Tribunal upheld the CIT(A)'s decision, dismissing the Revenue's appeal on this ground as well. Conclusion: The Tribunal upheld the CIT(A)'s order, confirming that the land sold by the assessee was agricultural and situated beyond 8 kilometers from the municipal limits, thus not a capital asset and exempt from capital gains tax. The Tribunal also upheld the admission of additional evidence by the CIT(A) as crucial and properly verified. Consequently, the Revenue's appeal was dismissed.
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