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TMI Blog2011 (3) TMI 1825X X X X Extracts X X X X X X X X Extracts X X X X ..... be so held now that there is no reason to believe and hence the reassessment is bad in law. 2. The learned Commissioner of Income Tax (Appeals) further erred both in law and on facts in confirming the action of the learned Income Tax Officer that transaction of sale of plot of land acquired before more than 30 years was towards adventure in the nature of trade and that the profit from sale thereof was chargeable as business income. On the facts and circumstances of the case and in view of the legal position settled by various judicial pronouncements, the land being held as capital assets, the profit/loss thereof was rightly computed by the assessee as chargeable under the head Capital Gain . 3. The learned Commissioner of Income Tax ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... validity of reopening of the assessment. Therefore, ground no.1 in the appeal is dismissed as such. 3. Adverting now to ground nos.2 to 7 in the appeal, facts, in brief, as per relevant orders are that return declaring income of ₹ 1,82,630/- filed on 25-10-2000 by the assessee-HUF, was processed u/s 143(1)of the Income-tax Act, 1961 [hereinafter referred to as the Act ]. Subsequently, assessment was reopened u/s 147 with the service a notice u/s 148 of the Act on 4.8.2005. In response, the assessee submitted vide letter dated 26.9.2006 that return filed on 25.10.2000 may be treated as return in response to notice u/s 148 of the Act. During the course of reassessment proceedings, the Assessing Officer[AO in short] noticed that the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nly one plot which was sold in two parts to the same party in two different years and the appellant has not taken any steps for providing the streets and bifurcating the plot. No steps were taken to make the land suitable for housing society. These contentions were made in addition to the contentions made by the appellant during the assessment stage which have already been mentioned above. The appellant relied on the decision in the case of ClT Vs. Sureshchand Goel, 163 Taxman, 54 (MP). 3.3 I have carefully considered the contentions of the appellant and the order. Basically, the appellant has purchased the land of 2662 sq. yds in 1971 and this property was sold as two plots to M/s Alkuresh Land Trading Corporation. The first plot was so ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ch, Ahmedabad in their decision vide ITA No.2031/Ahd/2000 for Asstt. Year 2002-03 has already decided the case treating the same as adventure in the nature of trade on the facts found. As far as the case of Sarojkumar Mazumdar Vs. C.I.T., 37 ITR 242 is concerned, it was merely held that onus lies on the department to prove that the transaction was an adventure in the nature of trade and the intention of the assessee is relevant. In the present case, the AO has already brought out the fact and discharged the onus regarding the intention of the assessee and the transaction being of adventure in the nature of trade. As far as the decision in the case of CIT vs. Sureshchand Goel. 163 Taxman 54(MP) is concerned, the same is distinguishable as ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... y the Hon. Bombay High Court in the case of Indian Hume Pipe Co. Ltd. Vs. CIT 195 ITR 386 (Bom.) clearly demonstrate that the appellant was engaged in the series of transactions which are in the nature of profit arising from the adventure in the nature of trade. This clearly falls within the ambit and scope of provisions of sec.2(13) of the I.T. Act, 1961 which is an inclusive definition which defines business includes any trade, commerce or manufacture or any adventure or concern in the nature of trade, commerce or manufacture. The said transaction in land cannot be called an investment and be treated under the head, 'Capital loss of ₹ 5,775/- as disclosed by the assessee before the A.O. The A.O. has rightly treated the profit f ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ng a similar issue in the AY 2002-03, the ITAT in the assessee s own case in ITA no.2031/Ahd/2005, concluded in their order dated 23-12-2005, as under:- 6 It was, in view of above facts and circumstances of the case that the ld. counsel for the assessee, submitted that the profit on sale of concerned land was taxable as long-term capital gain and not business income. According to him, since the assessee has sold a part of land and had suffered loss, it was not shown in the return for Asst Year 2002-03 with the intention that the net result, i.e. profit or loss will be declared later on. 7. On the other hand, the Id. DR has supported the orders of the Revenue Authorities. 8. After careful consideration of the rival submissions and ..... X X X X Extracts X X X X X X X X Extracts X X X X
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