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TMI Blog2012 (10) TMI 567X X X X Extracts X X X X X X X X Extracts X X X X ..... l evidence under Rule 46A of the Income Tax Rules, 1962 read with Section 250(4)(5) of the Income-tax Act, 1961,, which goes to the very root of the matter and involves a substantial cause in determining correct income and the correct tax liability for the year under appeal of the appellant company, production whereof before the ld. CIT(A) is fully covered by the exception in clause (d) of sub-Rule(1) of Rule 46A which reads as "Where the Assessing Officer has made the order appealed against without giving sufficient opportunity to the appellant to adduce evidence relevant to any ground of appeal." The said additional evidence therefore, be ordered to be admitted. 2. That on the facts and in the circumstances of the case, the ld. CIT(A) er ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... siness profit arising out of adventure in the nature of trade and added to the income of the assessee. 4. By the impugned order, the ld. CIT(A) confirmed the addition after having the following observations :- "7.4 I have carefully considered the written! oral submission of the Ld. AR as also the findings of the Assessing Officer including their case records. This is a case where the assessee has stated to have purchased eight Acres of Rural Agricultural land situated at Khasra No. 230, Gram Ratanpur Sadak, P.H.No.44 Tah. Huzur, Bhopal vide agreement to sale dated 10.05.1998 for Rs 18,40,000/-. The seller as per this agreement is M/s. Kanha Grab Nirman Sahakari Samiti, Bhopal. Admittedly, no sale deed was executed for such purchase. The a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ri Samiti, Bhopal and not the appellant. The Assessing Officer has also observed that as per the revenue records the appellant was never the owner of such agricultural land. The Assessing Officer has also observed that the appellant never acquired such agricultural land as per the Transfer of Property Act. Even the agreement to sale dated 10.05.1998 was not produced during the assessment proceedings and the same has not been accepted as an additional evidence. In these circumstances when the appellant was neither the owner of such agricultural land nor the seller of such agricultural land, therefore, no such claim for exempted capital gain can be allowed to the assessee. The Assessing Officer accordingly taxed such surplus amounting to Rs. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... cie in the nature of adventure in nature of trade and, therefore, the action of the Assessing Officer assessing the total income of Rs. 24,20,000/- as business income as against the claim of the appellant as exempted capital gain is confirmed. " 5. Against the above order, the assessee is in further appeal before us. 6. Shri P.K. Jain, C. A., appeared on behalf of assessee and contended that agricultural land was transferred in favour of the assessee in view of the extended provisions of Section 2(24) according to which even taking the possession of land amounts to transfer. He further contended that the agricultural land was excluded from the purview of capital assets as per Section 2(14)(iii) of Income-tax Act, 1961. As per ld. Authoriz ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... eliberated on the judicial pronouncements cited by the ld. Authorized Representative during the course of hearing before us. From the record, we found that the assessee is engaged in the business of developing real estate and sale of row houses. In the return of income, the assessee had shown exempted capital gains on sale of land. As per the findings given by the lower authorities and which are also as per material on record, clearly indicate that the assessee is not the seller of land but was merely consenter to the transactions of sale. We also found that the assessee has not shown the agricultural land alleged to be acquired in the year 1998, as investment in its books of accounts, therefore, there is no reason to treat the land as capi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 8, we found that the assessee has not shown the purchase of agricultural land in its books of account as an investment. Therefore, there is no reason to accept the contention of ld. Authorized Representative that assessee has acquired agricultural land as an investment, profit arising out of which should not be liable to be taxed as business profit or capital gain, when the assessee has grossly failed to show that this agriculture land was situated outside the municipal limit so as to come under the purview of Section 2(14)(iii) of the Income-tax Act, 1961. Thus, even after accepting the agreement to sale deed dated 10.5.1998, the conclusion drawn by lower authorities will not be changed and profit arising in favour of the assessee as a con ..... X X X X Extracts X X X X X X X X Extracts X X X X
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