9911796707
TMI Blog2019 (3) TMI 639X X X X Extracts X X X X X X X X Extracts X X X X ..... 6/-. 2. The facts of the case, in brief, are that the assessee had an industrial unit of manufacturing paints at Talkatora Industrial Estate, Aishbagh, Lucknow which is an urban area. This land and building was transferred to Shri Rakesh Jain Prop. M/s Prag Polymers during financial year 2011-12 for a consideration of Rs. 25 Lacs and land at G-18, UPSIDC Industrial Area, Chinhat Deva Road i.e. Non-Urban Area. On the said transaction the assessee had claimed exemption u/s 54G of the Act in assessment year 2012-13 which was allowed to it vide order u/s 143(3) dated 29.03.2015. The land at G-18, UPSIDC Industrial Area, Chinhat Deva Road, Non-Urban Area, was not found to be suitable for various reasons and hence transferred to M/s Triveni Alm ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ear 2012-13. The profit of Rs. 1,24,39,700/- from the transaction was accepted in assessment year 2012-13. He further submitted that the land at C-18, UPSIDC Industrial Area, Chinhat Deva Road, which was part of the sale consideration, was found to be not suitable for various reasons and hence transferred to M/s Triveni Almirah for a consideration of Rs. 1.71 Crore. The proceeds from this land, which was received as part of sale consideration of sale of Urban Land and Building at Aishbagh Lucknow, was invested during the year Under investment into purchase of land Rs. 1,74,04,050/-. The assessee had claimed this surplus of Rs. 60,70,996/- as exempt u/s 54G being gain on shifting of Industrial Undertaking from Urban to Non-Urban area. As per ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... isen from sale of land in non-urban area. The learned CIT(A) has very categorically held that in the year under consideration the transfer of land was from a non-urban area to a non-urban area and therefore, section 54G was not applicable. The findings of learned CIT(A) are quite relevant which for the sake of convenience are reproduced below: "7.1 Enactment of section 54G by the legislature was with an intention to deurbanise populated areas and de-industrialise such area by encouraging industrialisation of non-urban areas, which were under developed. Section 54G is a provision intended for promoting inclusive growth of the country. 7.2 A plain reading of section 54G shows that exemption u/s 54G is on Capital Gain arising on transfer o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nt and allowed by the A.O.) a. In this A.Y., the appellant had claimed exemption u/s 54G which was allowed vide order u/s 143(3) of the Act, dated 29.03.2015. b. The appellant had Industrial Unit of Manufacturing paints at Talkatora Estate, Aishbagh, Lucknow (URBAN AREA). The said Industrial Undertaking (land and building etc.) was sold to Shri Rakesh Jain Prop. M/s Prag Polymers during F.Y. 2011-12 for a sum of Rs. 25 Lacs + land at G-18, UPSIDC Industrial Area, Chinhat Deva Road (NON-URBAN AREA). The sale value of the Capital Asset was shown at Rs. 1,25,84,700/-. The purchase value was shown at Rs. 1,45,000/-. Indexed cost worked out to Rs. 11,38,250/-. The Capital Gain on the said transaction worked out to Rs. 1,14,46,450/-. On this ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ellant has shifted the Industrial Unit from one Non-Urban Area to another Non- Urban Area, therefore, no exemption u/s 54G is admissible. 8.4 A plain reading shows exemption u/s 54G is on Capital Gain on transfer of a Capital Asset used for purpose of business undertaking situated in an URBAN AREA to an NON-URBAN AREA. The object' of enacting section 54G was to deurbanise and remove industries from Urban Areas and promote Industrialisation in Non-Urban Areas. This is the primary condition for eligibility of the exemption u/s 54G. However, in the case of appellant in A.Y. 2013-14, the transfer of Capital Asset used for purpose of business undertaking is from a NON-URBAN AREA to another NON-URBAN AREA. This action of the appellant doe ..... X X X X Extracts X X X X X X X X Extracts X X X X
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