Balchandra Builders Pvt. Ltd. Vs DCIT (ITAT Chennai)
In , the Chennai Bench of the Income Tax Appellate Tribunal (ITAT) partly allowed the appeal filed by the assessee for Assessment Year 2011-12. The dispute primarily concerned rejection of a fresh claim for exemption arising from sale of agricultural land and verification of deduction claimed under Section 80IB(10) of the Income Tax Act.
The assessee company had sold lands situated in Padur and Kazhipattur villages jointly with its directors, Shri Sudarsan and Shri Balachander. In its original return of income, the assessee offered the sale proceeds to tax. However, the directors, in their individual returns, treated the gains from sale of the same lands as exempt on the ground that the lands were agricultural lands.
During assessment proceedings, the assessee filed a revised computation on 17.02.2014 claiming exemption on the sale proceeds on the basis that the lands sold were agricultural lands falling outside the definition of capital asset under Section 2(14) of the Act. The Assessing Officer rejected the claim on the ground that no revised return had been filed and relied on the Supreme Court judgment in Goetze (India) Ltd. v. CIT. The Assessing Officer also observed that the issue of agricultural character of the land had not been accepted in proceedings relating to the individual directors.
