9911796707
TMI Blog2016 (10) TMI 528X X X X Extracts X X X X X X X X Extracts X X X X ..... efore clear that the impugned agricultural land was not situate within jurisdiction of VVMC during the impugned assessment year. We also find that VVMC was also not a notified municipality during the impugned assessment year, as per last available notification no. 8010(E) dated 6th 1994 as amended by notification no. SO 1302 dated 28th Dec 1999. In fact the Vasai Virar Municipal Corporation is still not notified under Income Tax Act, even as on date since it is not in the list of Municipalities as per last available notification no. 8010(E) dated 6th 1994 as amended by notification no. S.O. 1302 dated 28th Dec 1999, under Income Tax Act. There is no dispute to the fact that at the time of Sale the subject agricultural land is situated in the village Juchandra of Taluka Vasai, the population of which was 5,912 as per the census, so is less than 10,000. We had also gone through the 1st , 2nd , 3rd draft notification dt. 14/09/2006, 03/07/2009 and 05/04/2010 respectively proposing that the Municipal Council of Vasai Virar Mahanagar Palika be constituted. However vide final notification dt. 31/05/2011 the City of Vasai Virar Mahanagar Palika came to be constituted. Since the sa ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ces of the case, the learned CIT(A) was not justified in confirming the addition of gains arising out of lands sold in an earlier assessment year, to the income of the current assessment year. 1.3.2. Without prejudice to the above, under the facts and circumstances of the case, the learned CIT(A) was not justified in confirming the adoption of the sale value as per section 50C of the Act, by ignoring the fact that the difference between actual sale price and market value was not more than 10% of the sale value. 1.3.3. Without prejudice to the above, under the facts and circumstances of the case, the learned CIT(A)was not justified in confirming the adoption of wrong indexation of cost of purchase resulting in a lower cost of purchase and a higher Capital Gain.? 2. Rival contentions have been heard and record perused. Facts in brief are that the assessee is engaged in the business of construction from the year 1983 under the name and style of a proprietary concern M/s Periera Juchandra Land Developers (PJLD). During the course of scrutiny assessment the AO observed that information was received through AIR module that the assessee had entered into a number of transa ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... '. The AO further held that the assessee has sold many plots of land some of which are in his name as per land records and for some he holds the Sathe-Karars or Agreement to Sale. In view of the discussions as above, both these are 'capital assets' as per the provisions of section 2(14) and profits/gains arising from transfer of these land forms part of taxable income. Thus, the entire profit arising on sale of land was brought to tax net under the head long term capital gains. 3. By the impugned order the CIT(A) confirmed the action of AO, against which assessee is in further appeal before us. 4. It was contended by ld. AR that the plots of land sold during the year are 'agricultural land' on the ground that he has continued agricultural operations after acquiring them and therefore the surplus from sale of land is 'agricultural income' and exempt from tax as per the provisions of the I. T. Act viz. Section 2(1A) and section 2(14). In support thereof he relies on 7/12 extracts from Land Revenue records and that he has sold such land on as-is-where-is basis without doing any development work. 5. He invited our attention to the submission made by ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 2(14){iii){b) in 1994. As regards the argument that the finality of the Notification is not reached due to a petition pending which is before the High Court, the same is not tenable since as on-date, the present notifications are final and have already taken effect. Relying on these notifications of the Government of Maharashtra, large-scale urbanization, rapid development of high-rise housing structures, transport facilities, etc. have found a place in and around the areas mentioned in the notification. These cannot be denied nor reversed. Therefore, it is only proper that the said vii/ages and the land located within, be construed as forming part of the 'larger urban area' as per the Notifications. Moreover assessments and tax need not be held up, pending finality of other legal proceedings since Income tax assessments, are time-bound which have to made every year and cannot be held-up until the final outcome of other legal proceedings are pronounced. 6. However the contention of AR was that the VVMC has been formed only on 31st May 2011; and therefore was not in place during the period in which he has sold the land. It was further argued by ld. AR that the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 2011-12. Without considering the same, the AO had considered the same as agricultural land sold during the year under consideration. Our attention was also invited to the relevant agreements to demonstrate that the possession was given in the respective/years and not in A. Y. 2011-12. 7. Without prejudice to the above it was argued that the learned AO has considered sale value as per section 50C of the Act without considering the facts that the difference between market value and sale value was not more between 1%-4% of the sales value. The learned AO has not considered first proviso of the section 32A( 4) of the Bombay Stamp Act 1958, whereas the 10% difference in the value stamp duty value and agreement value is allowed. For this purpose, reliance was placed on the decision of Hon. Pune Bench in the case of Rahul Constructions Vs. Dy. CIT (2010) 38 DTR 19 wherein the Tribunal directed the assessing officer to take the consideration at ₹ 70 lakhs against the estimated value by valuation officer at ₹ 75,76,712/- as the value of the property so estimated that a difference of +-10% which is because of the opinion of the individual valuation officer. No one is expected ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the local people, the area covered under Municipal Corporation of Vasai-Virar is revised and the revised boundaries shall be as per schedule III and IV (of the said Notification) respectively. Therefore, it is clear that the notification dated 31st May 2011 cannot be read in isolation but has to be read with the original Notification dated 3rd July 2009. CSDT has already Vasai Municipal Council and Virar Municipal Council under the provisions of section 2(14)(iii)(b) in 1994. The assessee plea that since pending petition before the court, the notification is not reach its finality is also not tenable since as on date, the present notification are final. Therefore, assessee's argument that the VVMC has been formed only on 31st May 2011 is factually incorrect. 9. We have considered rival contentions and carefully gone through the orders of authorities below. From the record we found that the land so sold by assessee was not within the jurisdiction of any of the municipality and further the agricultural lands sold are not situated within 8 Km from any of the municipality i.e. Vasai Municipal Council, Navgarh Manikpur Municipal Council, Nalasopara Municipal Council and virar ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ion and the out of these 53 villages only 24 of them came to be notified on from 31st May 2011. Hence the agricultural land situated in village Juchandr remained as a rural area and became an Urban Land only on from 31 st May 2011. Vasai Virar Mahanagar Council (VVMC) had finally came into existence vide Final notice dated 31st May 2011 i.e. A.Y. 2012-13. This is further fortified by the fact that the VVMC started collecting taxes in its name only on from the financial year 2011-12 i.e. A.Y. 2012-13. Further as per the revenue records the Juchandra Village is shown as a separate entity till 31.05.2011.It is therefore clear that the impugned agricultural land was not situate within jurisdiction of VVMC during the impugned assessment year. We also find that VVMC was also not a notified municipality during the impugned assessment year, as per last available notification no. 8010(E) dated 6th 1994 as amended by notification no. SO 1302 dated 28th Dec 1999. In fact the Vasai Virar Municipal Corporation is still not notified under Income Tax Act, even as on date since it is not in the list of Municipalities as per last available notification no. 8010(E) dated 6th 1994 as amende ..... X X X X Extracts X X X X X X X X Extracts X X X X
|
