Certificate of competent authority only can be relied for measurement of distance of land from Municipality

We have observed that the assessee has claimed to have sold an agricultural land during the previous year relevant to impugned assessment year , which is stated to be situated near the boundary of Kolat Village and Sanathal Village. The assessee had contended that the assessee had sold agricultural land which is more than 2 km from Sanand Municipal Corporation . The assessee had claimed that the assessee is entitled to the benefit of notification no. 9447 dated 06-01-1994 issued by Central Government and since the assessee land is beyond 2 km from Sanand Municipal Corporation, the assessee is entitled to the benefit of above notification . The assessee has claimed that the sale consideration should be taken to be non-taxable capital receipt arising from sale of agricultural land in accordance with definition of capital asset as contained in Section 2(14) of 1961 Act.

However, the relevant certificate from the competent authority has not been submitted by the assessee as required under law for determination of the distance of land in question from Municipality etc. The ld. CIT(A) relied upon the certificate from Executive Engineer, Ahmadabad and of Sarpanch of the Village, who are not competent authority as prescribed under law. The assessee need to produce the said certificate from competent authority as prescribed under law for issue of such certificate.

The ld. D.R. submitted that Tahsildar is the competent authority and not the Executive Engineer or Sarpanch, and the certificates issued by them are not relevant. The assessee has to produce the relevant certificate from the Tahsildar measuring distance from nearest Municipality etc. as stipulated u/s 2(14) of 1961 Act.

We would also like to clarify that distance between the municipal limit and the agricultural land shall be measured having regards to the shortest road distance, as the impugned assessment year under appeal is assessment year 2011-12 while the amendment to section 2(14) of 1961 Act was brought in by Finance Act, 2013 w.e.f. 01-04-2014 wherein the said distance is to be measured aerially , and the said amendment is held to be prospective by Nagpur Bench of Hon’ble Bombay High Court vide orders dated 30-03-2015 in the case of Smt Maltibhai R Kadu in ITA no. 151 of 2013.

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