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TMI Blog2024 (11) TMI 1023X X X X Extracts X X X X X X X X Extracts X X X X ..... a party to the same sale deed for the same land, the AO cannot take a different view. It is also his submission that the various documents filed before the Assessing Officer as well as the Ld. CIT(A) / NFAC evidencing the sale of milk to dairy, cattle food, farm pesticides and medicines, details of crop revenue, etc. were completely ignored by the lower authorities. We find some force in the above arguments of assessee. A perusal of the assessment order of Mr. Santosh Vitthal Mhsurkar/coowner shows that the AO has accepted the land sold as ancestral agricultural land and is not a capital asset as per section 2(14) of the Income Tax Act, 1961. This order was passed by the Assessing Officer after the order passed by the Ld. CIT(A) / NFAC and this was accepted as an additional evidence. In the instant case, the assessee is the consenting party No.2 to the sale of the said land and the same sale deed. We further find that the various documents filed by the assessee in the paper book were not considered by the Ld. CIT(A) / NFAC. Considering the totality of the facts of the case and in the interest of justice, we deem it proper to restore the issue to the file of the Assessing Officer wi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... on 11.05.2015 as mentioned in page No.23 of sale agreement. It was submitted that the sale consideration was used for the purpose of acquisition of agricultural land u/s 54B of the Act on 08.10.2015. Therefore, the relevant date for the purpose of investment u/s 54B of the Act is date of first installment received on 03.06.2015, therefore, the assessee is eligible to claim deduction u/s 54B of the Act. The assessee further submitted that the claim of deduction u/s 54F also is satisfied since the assessee has purchased one residential house within a period of one year before the date of transfer or within a period of 2 years after the date of transfer. The assessee has purchased a flat at Bhugaon dated 01.12.2015 vide registration No.4566/2015 for a consideration of Rs.12,72,200/- within 1 year before the date of transfer of agricultural land. Accordingly, the assessee submitted that the claims of deduction u/s 54B and 54F of the Act are justified. 5. However, the Assessing Officer was not satisfied with the arguments advanced by the assessee. So far as the claim of the assessee that the land sold was agricultural land for which the Zone Certificate has been filed is concerned, he n ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of Pune district with semi-urban population of 171,006 people according to the 2011 Census. Considering the fact that the sale of land had taken place on 31.12.2015, it is certain that the population of the locality must have increased substantially by that time. Therefore, the impugned land does not fall within the parameters of agricultural land as defined u/s 2(14)(iii). According to him, the location of a land solely can never be the final indicator of the land use. Further, as per the provisions of section 54B of the Act, the land must be used for agricultural purposes in the two years immediately preceding the date on which the transfer took place. 8. Relying on the decisions of the Bangalore Bench of the Tribunal in the case of Smt. G. Vijay Padma (2020) 119 taxmann.com 441 (Bangalore Trib.), Jairam G Kimmane (2020) 119 taxmann.com 99 (Bangalore Trib.), the decision of the Hon ble Madras High Court in the case of GRK Reddy Sons (HUF) (2021) 123 taxmann.com 291 (Mad) and the decision of the Hon'ble Supreme Court in the case of Smt. Sarifabibi Mohmed Ibrahim (1993) 70 Taxman 301 (SC) and various other decisions, he held that the land appears to be a commercial deal of a l ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nsfer without considering the evidences submitted to substantiate that the said land has been used for agricultural purposes. 5. The learned CIT(A) erred in law and in facts in holding that, appellant has not used the said agricultural land for agricultural purpose in two years immediately preceding the date of transfer only for the reason that, the said land is sold to third party for carrying out commercial activity without appreciating fact, the said agricultural land is used for agricultural purposes. 6. The learned CIT(A) erred in law and on facts in holding that, appellant is not eligible to exemption u/s 54B of ITA, 1961 for purchase of new the agricultural land prior to transfer of the said agricultural land without appreciating that, the advance received on sale of said agricultural land is back to back used for investment in new agricultural land. The learned CIT(A) ought to have applied ratio laid down in CBDT circular 359 dated 10/05/1983 that, the assessee investing earnest money in specified assets before date of transfer qualifies for exemption. 7. The learned CIT(A) erred in law and on facts in holding that, appellant is not eligible to exemption u/s 54B of ITA, 196 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... understood as to how the land of the assessee can be considered as agricultural land. So far as the decisions relied on by the Ld. CIT(A) / NFAC are concerned, he submitted that those decisions are not applicable to the facts of the present case and are distinguishable. 11. The Ld. DR on the other hand heavily relied on the orders of the Ld. CIT(A)/NFAC. He however submitted that he has no objection if the matter is restored to the file of the Assessing Officer for verification of the details which were filed before him but not considered. He also relied on the decision of the Pune Bench of the Tribunal in the case of Abhijit Subhash Gaikwad vs. DCIT (2015) 44 CCH 777 (Pune-Trib.). 12. The Ld. Counsel for the assessee in his rejoinder submitted that the decision of the Pune Bench of the Tribunal in the case of Abhijit Subhash Gaikwad vs. DCIT (supra) is not applicable to the facts of the present case. Referring to para 23 of the order, he submitted that the assessee before the Assessing Officer had furnished the copy of 7/12 extract, according to which, the land was Jirayat fallow land i.e. the land being not capable of any cultivation. Referring to para 28 of the order of the Tri ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... not fall within the parameters of agricultural land as defined u/s 2(14)(iii). Further, the assessee has purchased the new agricultural land before the land in question was sold, the investment in the land was also made jointly i.e. in the name of the assessee as well as Mr. Santosh Vitthal Mhsurkar and the assessee did not offer any clarification to indicate his share in the said investment, if any. It is the submission of the Ld. Counsel for the assessee that he was running a dairy firm and the land sold was used for growing grass and therefore, it was an agricultural activity. It is also his submission that in the case of one of the co-owners i.e. Mr. Santosh Vitthal Mhsurkar, the Assessing Officer in the order passed u/s 144/147, dated 13.03.2024 for assessment year 2016-17 has accepted the land as agricultural land, therefore, the assessee being a party to the same sale deed for the same land, the Assessing Officer cannot take a different view. It is also his submission that the various documents filed before the Assessing Officer as well as the Ld. CIT(A) / NFAC evidencing the sale of milk to dairy, cattle food, farm pesticides and medicines, details of crop revenue, etc. we ..... X X X X Extracts X X X X X X X X Extracts X X X X
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