2023 (4) TMI 572 - AT - Income Tax

Computation of capital gains on sale of land - Nature of land sold - assessee argued that the impugned land sold by the assessee along with other co-owners is an agricultural land which is situated beyond 8 kms from the limits of local municipality - HELD THAT - CIT(A) has recorded categorical finding that the assessee could not file any evidence to prove that the impugned land sold by the assessee along with other co-owners is an agricultural land which does not come under the purview of capital gains. CIT(A) had discussed the issue in light of facts brought out by the AO and arguments advanced by the assessee and came to the conclusion that the remand report called for from the AO with respect to the claim of the assessee, the AO gave his findings that the impugned land is not an agricultural land. Assessee neither filed any evidences nor explained how said land is agricultural land which is outside the scope of capital gains tax. The findings of the facts recorded by the CIT(A) is uncontroverted. Assessee neither appeared nor filed any details. No error in the reasons given by the ld. CIT(A) to sustain computation of capital gains on sale of land and thus, we reject grounds taken by the assessee.

Summary

Issues involved:
The appeal pertains to the assessment year 2013-14 and involves the disallowance of claim regarding the status of agricultural land and the eligibility for deduction under section 54F of the Income Tax Act.

Regarding the status of agricultural land:
The appellant, an individual, had sold an immovable property along with co-owners for a consideration of Rs. 3,11,30,400, but had admitted only Rs. 25 lakhs in the return of income. The Assessing Officer (AO) computed long term capital gains and rejected the deduction claimed under section 54F of the Act. The appellant contended before the CIT(A) that the land sold was agricultural and situated beyond 8 kms from the local municipality limits. However, the CIT(A) found that the appellant failed to provide evidence to prove the agricultural status of the land. While directing the AO to allow the deduction under section 54F based on a judicial precedent, the CIT(A) concluded that the land was not agricultural. The appellant did not appear before the tribunal, and the tribunal upheld the CIT(A)'s decision, stating that the appellant did not substantiate the agricultural status of the land, leading to the rejection of the grounds taken by the appellant.

Regarding the eligibility for deduction under section 54F:
The AO rejected the deduction claimed under section 54F on the basis that the appellant had invested the consideration in another residential property in the name of his wife. The CIT(A), considering relevant submissions and judicial precedents, directed the AO to allow the deduction under section 54F following a decision of the High Court. The tribunal, after hearing the Senior Additional CIT and reviewing the material on record, upheld the CIT(A)'s decision to allow the deduction under section 54F, as the appellant did not challenge this aspect. The tribunal dismissed the appeal filed by the appellant, affirming the decision of the CIT(A) regarding the deduction under section 54F.