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TMI Blog2018 (7) TMI 749X X X X Extracts X X X X X X X X Extracts X X X X ..... income in her return of income due to smallness. In view of this we do not find any infirmity in the order of the ld CIT(A) and we uphold it. Accordingly, appeal of the revenue is dismissed. - ITA No. 191/Del/2015 And CO No. 233/Del/2015 - - - Dated:- 10-7-2018 - SHRI AMIT SHUKLA, JUDICIAL MEMBER AND SHRI PRASHANT MAHARISHI, ACCOUNTANT MEMBER For The Revenue : None For The Assessee : None ORDER PER PRASHANT MAHARISHI, A. M. 1. This is an appeal filed by the revenue against the order of the ld CIT(A)- 1, Dehradun dated 14.10.2014 for the Assessment Year 2010-11. 2. The revenue has raised the following grounds of appeal:- 1. That the ld CIT(A)-I, Dehradun has erred in law and on facts in holding t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ree separate sale deed. The assessee filed her return of income on 10.09.2010 declared income of ₹ 449029/-. In the return of income the assessee declared profit from petrol pump filling station of ₹ 511852/- and income from other sources. The ld AO noted that the assessee has not declared the capital gain on sale of property. The ld AO noted that the assessee has sold the land which is a capital asset‟ and is not an agricultural land‟ as the Govt has issued a notification wherein, the above land was notified as industrial land. He rejected the explanation of the assessee that it is an agricultural land. He further supported the same stating that the assessee has not shown agricultural income in her return of incom ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ra No. 6 of his order which is as under:- 6. I have duly considered the facts and circumstances of the case and the submission of the assessee. It is a fact that the assessee was granted a piece of land by the Government of Uttarakhand after the martyrdom of her husband in the Kargil conflict on 10.08.1999. The size of the land was approximately 1 acre. The Central Government vide Notification No. 177/2004 dated 26.08.2004 declared the land of the assessee as industrial land fit for deduction u/s 80-IC. However, there is no evidence that the assessee put the land to any other use except agricultural purposes till the sale of land on 31.12.2009. The land was entered in the revenue record as agricultural land. In fact it continues to r ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the price the land was sold. On these two tests the peculiar circumstances of the notification of the area into an industrial area would explain why the assessee sold the land n sq.mts. and why the cost of the land appreciated considerably on account of its possible use for industrial purposes. However, as has been pointed out in the case of Gordhanbhai Kahandasdatwadi v. CIT [1981) 127 ITR 664 (Guj.) potential non-agricultural use of the land does not alter the character of land from agricultural to non-agricultural land and the correct tests whether on the date of sale the land was agricultural or not. Furthermore, as pointed out by the assessee, the mere fact that her land were included into a industrial area would not change the charac ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e. it is agricultural income within the meaning of clause (1) under section 2 of the Act. The ITAT Hyderabad bench in the case of T. Urmilla vs. ITO W-6(2) in ITA No. 398 of 2012 dated 12.12.2012 while dealing with the case of an assessee whose land incorporated into Hyderabad Airport Development authority held that the Hyderabad Airport Development authority was not a municipal authority and was outside the outer municipal limit of Hyderabad. The land transferred could not be considered a capital asset under the provision of section 2(14)(iii) of the I.T.Act. Following the ratio of these judgments I hold that the mere notification of the area in which the assessee s land was situated as an industrial zone would not alter the character of ..... X X X X Extracts X X X X X X X X Extracts X X X X
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