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Capital gain on transfer of agriculture land shall be chargeable to tax only if such agriculture land situated in an urban area. The land will be considered as agricultural land in an urban area if it satisfies the following conditions :
♦ Any area which is in the jurisdiction of a municipality or cantonment board having a population ** of 10,000 or more.
Or
♦ In any area within distance –
| 2km or less * from the local limit of municipality or cantonment board | If the population ** is more than 10,000 but less than or equal to 1 lakh i.e ( 10,001-1,00,000) |
| 6 km or less * from the local limit of municipality or cantonment board | If the population ** more than 1 lakh but less than or equal to 10 lakh i.e (1,00,001-10,00,000) |
| 8 km or less* from the local limit of municipality or cantonment board | If the population ** is more than 10 lakh |
* measured aerially
** population according to census on the last day of preceding previous year
Illustration to 2nd condition
| Village | Area distance measured aerially from such municipality or cantonment board (km) | Population according to census on the last day of preceding previous year | Taxability on transfer of agriculture land |
| A | 1 | 9,000 | NOT TAXABLE |
| B | 1 | 11,000 | TAXABLE |
| C | 2.5 | 11000 | NOT TAXABLE |
| D | 2.5 | 1,10,000 | TAXABLE |
| E | 6.5 | 9000 | NOT TAXABLE |
| F | 6.5 | 11000 | NOT TAXABLE |
| G | 6.5 | 110000 | NOT TAXABLE |
| H | 6.5 | 500000 | NOT TAXABLE |
| I | 6.5 | 1100000 | TAXABLE |
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Author Bio
Mr. A, aged 45 years sold an agricultural land for Z 52 lakhs on 04.10.2019 acquired at a
cost of ¥ 49.25 lakhs on 13.09.2018 situated at 7 kms from the jurisdiction of municipality
having population of 4,00,000 and also sold another agricultural land for
£53 lakhs on 12.12.2019 acquired at a cost of 3 46 lakhs on 15.02.2018 situated at1.5
kms from the jurisdiction of municipality having population of 12,000. What would be the amount of capital gain chargeable to tax in the hands of Mr. A for the assessment year
2020-21? Cost inflation index for F.Y. 2017-18: 272; 2018-19: 280: 2019-20:289.
(a)
Short-term capital gain of ¥ 9.75 lakhs
b)
Short-term capital gain of Z 7 lakhs Long-term capital gain of. 4,12,500
d)
Long-term capital gain of ¥ 5,29,196
Please help me to find the answe
All tax systems are based on a designated authority that determines whether the article is taxable. in this case taxability determined by aerial distance. any designated authority as per statute, that measures the distance, given that the location of land could be in different districts/states ?
sir
I would like to know weather income tax is applicable in relation to selling of two revenue land in replace purchasing of one land in first selling and make construction for second one. plz. clarify .
I had purchased agriculture land of 13 hector in Lavad village 13 km. far from Dehgam municipality of gandhinagar dist. Dehgam has 42000 population. Land was purchased in july 2010 and sold within 1 year.capital gain tax was charged. Was this tax chargable ?
I want to know if the land is situated at 1 km distance and the population is 1,01,000. Then whether it would be taxable?
If going by your above definition, the limit for land situated within 2 kms is 10,001 – 1,00,000. So if in above situation, if the population is 1,01,000 for 1 km distance land, then it will be considered as NOT TAXABLE.
I want to understand the following for the distance of 2km or less.
You have mentioned,
“If the population ** is more than 10,000 but less than or equal to 1 lakh i.e ( 10,001-1,00,000)”
If the population is below 1,00,000, then anyhow it is non taxable. Then why there is a need to mention from 10,001 – 1,00,000? If it is below 10,000, then also it is non-taxable. So the limit should be 0 – 1,00,000 not 10,001 – 1,00,000.
Please help me to understand