9911796707
TMI Blog2019 (8) TMI 45X X X X Extracts X X X X X X X X Extracts X X X X ..... residential locality of Navrangpura and other societies to which reference was made by the Appellate Assistant Commissioner in his order in that case. It was further in evidence that neither the assessee nor the person to whom the assessee had sold different plots of land had, at any time, made any attempt to put the land to non-agricultural use. Therefore we are of the considered opinion that the impugned land on which Ghas is shown as per revenue record was in the nature of agricultural land on which agricultural activities were being carried out in the form of grass and same was irrigated by well . Therefore, the assessee is entitled for deduction u/s.54B, accordingly this ground of appeal is allowed in the appeal of the assessee. X X X X Extracts X X X X X X X X Extracts X X X X ..... al land located at village Utran is not subject to long term capital gain for the reasons that the assessee land is covered by Clause (b) sub-clause (iii) of section 2(14) of the I.T.Act. 5. The ld.CIT(A) observed that the only issue involved in the appeal is the addition of ₹ 2,42,91,150/- under the head LTCG there have been claims, revised claims, additional claims by the appellant before the ld.Assessing Officer and before the ld.CIT(A). The appellant filed the Return of Income showing capital gain and claimed deduction u/s.54F and 54B against same. Subsequently, the assessee filed revised return showing 'Nil' capital gain claiming that the sold by him is agricultural land exempt from development of capital asset u/s.2(14) of the Act. The Assessing Officer has written letter to local authorities i.e. SUDA and SMC to ascertain the distance of the land from Surat Municipality Limits. From the report of SUDA of local authorities, the Assessing Officer found that the land of the appellant falls within the limits of SMC, so he rejected the claim of the assessee and also denied the deduction u/s.54F & 54B of the Act. The ld.CIT(A) further observed that as per the certificate i ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... agricultural land, hence a liberal approach is required. Further, the Assessing Officer has based on his observation of the Return of Income of subsequent assessment years and not earlier years. No comments have been offered regarding the extract of land records in Form No.7/12 of both the lands. The lands may be used for agricultural purpose even then the assessee may not derive agricultural income. The authentic and primary document to be seen in this regard is land revenue records, as per the Form No.7/12 produced the old land was used for growing Ghas/Grass and also had irrigational facilities of well. The new land is used for growing sugarcane/shirdi. Therefore, the issue is to be decided is whether grass or ghas mentioned in Form No.7/12 indicates agricultural use of the land. The ld.CIT(A) opined that unlike the mention of agricultural crops such as maize, sugarcane etc., the mention of Ghas/Grass in Form No.7/12 does not automatically prove the agricultural activities unless some corroboration is provided by the appellant, hence ld.CIT(A) held that conditions u/s.54B are not fulfilled, therefore, the claim for deduction u/s.54B was denied. 8. Being aggrieved, the assesse ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... that as per Lexico Oxford dictionary, "plant" means: A living organism of the kind exemplified by trees, shrubs, herbs, grasses, ferns, and mosses, typically growing in a permanent site, absorbing water and inorganic substances through its roots, and synthesizing nutrients in its leaves by photosynthesis using the green pigment chlorophyll. g. Considering the above definition, it is clear that grass is a biological asset and when there is transformation of soil into grass i.e from one biological asset to another biological asset, it shall be construed to be through agricultural activity more so when it is also mentioned in revenue records that the irrigation is through well and other irrigation methods which is accepted by the Ld CIT(A) and hence the deduction may please be allowed u/s.54B. h. Further, it is to be appreciated that Further, reliance is also placed on the decision of Emperor vs Probhat Chandra Barua dated 08.06.1921 (1924) ILR 51 Cal 504] wherein it was held that the activity of pasturing ie growing of grass for fodder would be agricultural income. 10. The Division Bench in Narandas Motilal's case [1971] 80ITR 39 (Guj.) pointed out that "throughout the re ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nd was being cultivated. The ld.Counsel further referred decision of Hon'ble Calcutta High Court in the case of Emperor vs. Probhat Chandra Barua [1924] 1 ITC 2874 (CAL) in which a question was arosed wherein the commissioner was of the opinion that pasturage being a branch of agriculture rent received from the use of assessee's forest as pasture was not assessable. However, it was held that income from pasturage was derived from land which was used for agricultural purposes and was, therefore in the case of a permanently settled state within the exemption given by section 4(3)(viii) of 1922 Act to agricultural income as defined by section 2(1)(viii). Income from pasturage was 'derived from land which was used for agricultural purposes' and was, therefore, in the case of permanently settled estate, within the exemption given by section 4(3)(viii) of 1922 Act to 'agricultural income' as defined by section 2(1)(a). In the circumstances that such income was derived from fees realized from graziers who grazed their cattle in the forest areas and was waste lands there was nothing to render inapplicable the definition of 'agricultural income' contained in clause (a). 11. Therefore, ..... X X X X Extracts X X X X X X X X Extracts X X X X
|
