Case Law Details
ACIT Vs Ashok W. Wesavkar (ITAT Mumbai)
In this case of ACIT vs. Ashok W. Wesavkar, the issue revolved around the tax treatment of the sale of agricultural land by the assessee. The assessee, who was a professional architect, had sold agricultural lands to Mayank Land Pvt. Ltd. for a considerable sum. The assessee claimed that the sale of agricultural land was not liable for capital gains tax as it did not qualify as a capital asset.
The Assessing Officer denied the exemption and asserted that the assessee had not carried out agricultural activities on the land, and thus, the income was not offered for taxation as agricultural income in the income tax return. The Assessing Officer relied on a report by an Inspector stating that the land was not suitable for agricultural activity.
Upon appeal, the CIT(A) called for a remand report and examined the assessee under section 131 of the Income Tax Act. After considering the assessee’s contentions and evidence, the CIT(A) allowed the claim, stating that the sale consideration was not liable to be taxed as capital gains.
However, when the Revenue appealed the decision, there was a difference of opinion among the members of the Income Tax Appellate Tribunal (ITAT). As a result, the matter was referred to a Third Member.
Please become a Premium member. If you are already a Premium member, login here to access the full content.
