Case Law Details
Smt. Nagappan Suganthi Vs ACIT (ITAT Chennai)
Introduction: A recent appeal case, Smt. Nagappan Suganthi Vs ACIT, before the Income Tax Appellate Tribunal (ITAT) Chennai involved issues related to the non-consideration of evidence regarding a deduction claim under Section 54B and the capital gains exemption on the sale of agricultural land. The ITAT’s decision resulted in remanding the matter to the Assessing Officer (AO) for a fresh assessment with all issues left open for consideration.
Detailed Analysis:
1. Background: The appeal, filed by the assessee, pertains to the Assessment Year (AY) 2014-15. It stems from an assessment order issued by the Assessing Officer (AO) under Section 143(3) read with Section 147 of the Income Tax Act on December 27, 2018. The Revenue also filed cross-objections against the said order, raising concerns about the classification of land as a capital asset based on its proximity to the nearest municipality.
2. Assessee’s Claim: The petitioner, a resident individual, had sold agricultural land for a consideration of Rs. 137.60 lakhs. In the original income tax return, no capital gains were declared. Subsequently, the case was reopened under Section 148 due to the absence of capital gains disclosure. During the assessment proceedings, the petitioner argued that the land should not be considered a capital asset since it had been used for agricultural operations and was situated over 8 kilometers away from the nearest municipality, Tambaram.
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