Land classified as agricultural in revenue records cannot be taxed as a capital asset

Pallava Resorts P Ltd. Vs DCIT (Madras High Court) The case concerns a private limited company engaged in hospitality, agricultural activities, and other allied businesses. The company purchased 20.068 acres of land in Mamallapuram in 2005 and sold it in 2008. The dispute arose when the Income Tax Department treated the land as non-agricultural and levied capital gains tax, while the assessee contended that the land was agricultural and therefore not subject to such tax. In the original assessment order dated 30 December 2010, the Assessing Officer (AO) held that the assessee failed to establi...