Case Law Details
Dharam Pal Saini Vs PCIT (ITAT Delhi)
Introduction: In a recent decision, the Income Tax Appellate Tribunal (ITAT) Delhi addressed a crucial matter in the case of Dharam Pal Saini vs PCIT. The appeal challenged the order of the CIT(A), Faridabad, dated 20.03.2022, framed under section 263 of the Income Tax Act.
Detailed Analysis: The crux of the matter was the sale of an urban agricultural land during the relevant assessment year. The assessee treated the land as agricultural, not subject to capital gains tax. However, the ITAT Delhi, through revision proceedings under section 263, questioned the assessment order dated 11.12.2019.
The Principal CIT, invoking jurisdiction under section 263, issued a notice to the assessee, questioning the correctness of the assessment order. The assessee conceded during the proceedings that the properties in question qualified as a capital asset under the Income Tax Act. Subsequently, the Principal CIT set aside the assessment, emphasizing that the land was indeed a capital asset.
Upon careful consideration of the orders and after hearing the counsel, the ITAT Delhi affirmed the decision of the Principal CIT. The tribunal concluded that the sale consideration of the urban agricultural land is subject to capital gains tax, aligning with the relevant provisions of the Income Tax Act. As a result, the appeal by the assessee was dismissed.
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