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TMI Blog1986 (7) TMI 2X X X X Extracts X X X X X X X X Extracts X X X X ..... nt the assessee from continuing as owner of the land even after the railway contract had been executed and putting it to any other use - Land is not stock-in-trade, but a fixed asset and loss from its sale thereon is capital in nature. - - - - - Dated:- 16-7-1986 - Judge(s) : SABYASACHI MUKHERJEE. and R. S. PATHAK. JUDGMENT The judgment of the court was delivered by R. S. PATHAK J.- ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ould be excavated and conveniently taken to the work site. One piece of land was acquired at a cost of Rs. 53,196 during the calendar year 1964 corresponding to the assessment year 1965-66, and the other piece of land was acquired for Rs. 15,045 during the calendar year pertaining to the assessment year 1966-67, bringing the total cost to Rs. 68,241. Soon after the work was over, the assessee sold ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... y the Income-tax Appellate Tribunal on the ground that the land formed a wasting asset and by constant digging of the earth, the land had become unserviceable. On reference being made to the High Court of Orissa at the instance of the Commissioner of Income-tax on the question of law set forth earlier, the High Court held that the loss of Rs. 30,045 claimed by the assessee was capital loss and, th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... at was a case where the land was taken on lease for a limited period of 11 months with the right to enter, occupy and use for quarrying purpose and to render marketable and carry away sand within or on the land. This court held that the lease money paid by the assessee was deductible as revenue expenditure. The court referred to the short period of the lease, which indicated that the lease was not ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ing as owner of the land even after the railway contract had been executed and putting it to any other use. The land was treated by the assessee as its fixed asset. In all the circumstances of the case, the two pieces of land must be regarded as capital assets and the loss claimed by the assessee must be regarded as a capital loss. The High Court is right in the view taken by it and the appeal i ..... X X X X Extracts X X X X X X X X Extracts X X X X
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