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TMI Blog2021 (1) TMI 832X X X X Extracts X X X X X X X X Extracts X X X X ..... SAIN, J.M. These are the appeals filed by the different assessees against the separate orders of the ld. CIT(A)-IV, Jaipur dated 21/12/2018 for the A.Y. 2015-16 2016-17 respectively. 2. In all these three appeals of the assesses, common issue have been involved, therefore, for the sake of convenience and brevity, a common order is being passed. 3. As a lead case, we take ITA No. 300/JP/2019 for the A.Y. 2015-16 for deciding the appeals. In this appeal, the assessee has raised following grounds: 1. That on the facts and in the circumstances of the case, the ld. CIT(A) is wrong, unjust and has erred in law in confirming finding recorded by the assessing officer that the provisions of Section 56(2)(vii)(b) of the I.t. Act, 1961 are applicable to the purchase of agriculture land(s) situated outside 8 KM of municipal area inasmuch as such agriculture land is not covered in the definition of property as given in clause (d)of explanation to said Section. The addition of ₹ 1401540 made to the income of the appellant and as confirmed by the ld. CIT(A) on this count on account of difference of DLC value and purchase consideration of Agriculture land(s) is therefore wron ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... essee and Smt. Nirmala Maheshwari have jointly purchased this property, the share of the assessee comes out as ₹ 14,95,000/-. and issued show cause notice as to why the difference of ₹ 4,96,200/- { of (2302400-1310000)} and ₹ 9,05,340/- { of (4800679-2990000)} totaling to ₹ 14,01,540/- may not be held as income from other sources in terms of Sec. 56 (2) (vii) (b) of the Act and accordingly added his total income. The assessee in reply stated that the said lands were agricultural land situated outside 8 Km of municipal limits and accordingly are not capital asset within the meaning of Sec. 2 (14) of the Act, therefore, the provisions of Sec. 56 (2) (vii) (b) of the Act were not applicable on the same. The A.O. thereafter reproduced provisions of section 56 (2) (vii) (b) of the Act and relying thereon held that contention of assessee is not acceptable and added ₹ 14,01,540/- in the hands of assessee in declared income. 4. Being aggrieved by the order of the A.O., the assessee carried the matter before the ld. CIT(A), who after considering the submissions of the parties and after perusing the material placed on record, upheld the order of the A.O. b ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... so and also derived support from section 194-IA which specifically excludes agricultural land from its purview while mentioning transfer of any immovable property. In this connection it is pertinent to peruse the definition of income given in sub-section 2 (24). The sub-section 2 (24) (xv) includes in income any sum of money or value of property referred to in clause (vii) or (viia) of sub-section 56 (2). The sub-section 56 (2) (vii) (a) applies to any sum of money while sub-section 56 (2) (vii) (b) applies to value of property and meaning of property is given in explanation (d) to section 56 (2) (vii). The Ld. A.O. thereafter relied on provisions of section 56 (2) (vii) (b) in respect to property acquired by assessee and reproduced the same in assessment order. The Ld. A.O. only picked the word immovable property from section 56 (2) (vii) (b) but the immovable property being also property r/w definition of income in section 2 (24) (xv) so section 56 (2) (vii) (b) is to be r/w explanation (d) and the mention of immovable property in clause 56 (2) (vii) (b) is within the meaning of said explanation (d) to sub-section 56 (2) (vii). The Ld. A.O. also reproduced part of Explanation (d) ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... is therefore requested that the addition of ₹ 14,01,540/- made by Ld. A.O. and confirmed by Ld. CIT(A) u/s 56 (2) (vii) (b) may kindly be deleted. 7. On the contrary, the ld DR has relied on the orders of the authorities below and submitted that the ld. CIT(A) has passed a speaking order considering all the details of the matter. 8. We have heard the ld. Counsels of both the parties and have perused the material placed on record. We have also deliberated upon the decisions cited in the orders passed by the authorities below as well as cited before us and we have also gone through the orders passed by the revenue authorities. We observe from perusal of the record that the only ground raised by the assessee before us is challenging the order of the ld. CIT(A) in confirming the findings of the A.O. to the effect that the provisions of Section 56(2)(vii)(b) of the Act are applicable to the purchase of agricultural land situated outside 8 KM of municipal area. As per the facts of the case, the assessee alongwith Shri Anil Parwal purchased a land at village Jatwara, Tehsil Bassi, Jaipur on 08.09.2014. It was also observed that while the DLC value of the said property was &# ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... (b), which read as under: (d) Property [means the following capital asset of the assessee, namely: -] (i) immovable property being land or building or both; (ii) shares and securities; (iii) jewellery; (iv) archaeological collections; (v) drawings; (vi) paintings; (vii) sculptures, [***] (viii) any work of art; [or] (ix) bullion;] 10. From the said explanation, it is abundantly clear that immovable property being land or building or both should be capital assets for applying section 56 (2) (vii) (b) of the Act. However, the definition of capital asset is given in Section 2 (14) of the Act. The clause (iii) of Section 2 (14) specifically excludes agricultural land of the description given therein from capital asset which means that agricultural land which are outside 8 KM of the municipal limits are not held to be capital asset and as per the facts of the present case, the agricultural land purchased by the assessee falls in the definition of agricultural land as is given in Section 2 (14) (iii) of the Act, so the same cannot be termed as capital asset. Since the agricultural land purchased by the assessee is not a capital asset ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... al asset of the assessee namely immovable property being land or building or both. It has been contended by the ld AR that all immovable properties of any nature are not covered in the definition of property. Only those immovable properties which are held as capital assets and is in nature of land or building or both are only covered u/s 56(2)(vii). We agree with the contention of the ld AR that where the term property has been defined to mean a capital asset as so specified and where an immovable property as so specified being land, building or both is not held as an capital asset, it will not be subject to the provisions of section 56(2)(vii)(b) of the Act. In the instant case, therefore, where the agricultural land doesn't qualify as falling in the definition of capital asset, provisions of section 56(2)(vii)(b) cannot be invoked. It is undisputed fact that there is no dispute to the fact that the land purchased by the assessee is an agricultural land outside 8 Km of municipal limits. Therefore, keeping in view the facts and circumstances of the case, we are of the view that the agricultural land purchased by the assessee is not a capital asset, therefore, provisions ..... X X X X Extracts X X X X X X X X Extracts X X X X
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