INCOME TAX ACT, 1961

Section 14

Head of income - Long term capital gains or Business income - Assessee did not conduct any other activity other than holding the land as investment -

Issue was as regards applicable head of income for land sold by assessee. Revenue challenged order of Tribunal contending that Tribunal ought to have considered intention of assessee to do business with properties in question and to have appreciated that it was in nature of business. Held: Assessee did not conduct any other activity other than holding the land as investment. It was also pertinent to mention that revenue did not come up with any documentary evidence to suggest that assessee had earned income from the transaction to the land in question during relevant year. Tribunal thereafter on basis of meticulous appreciation of evidence on record has recorded a finding that assessee has rightly disclosed the income from the property as long-term capital gains instead of business income. Aforesaid finding by no stretch of imagination could be believed to either perverse and arbitrary.

REFERRED : CIT & Anr. v. Bagmane Developers (P) Ltd. (2017) 392 ITR 379 (Karn) : 2017 TaxPub(DT) 0790 (Karn-HC); CIT v. Sohan Khan & Anr. (2008) 304 ITR 194 (Raj-HC) : 2008 TaxPub(DT) 1941 (Raj-HC); CIT v. Shambhu Investment (P) Ltd. (2001) 249 ITR 47 (Cal) : 2001 TaxPub(DT) 1251 (Cal-HC); Shambhu Investment (P) Ltd. v. CIT (2003) 263 ITR 143 (SC) : 2003 TaxPub(DT) 0948 (SC)

FAVOUR : In assessee's favour

A.Y. :

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