11 February 2011
Items of Personal Effects, Agricultural Land Beyond specified area are not Cap assets and hence not taxable under Cap gains.If these items are not capital assets, what are their status and is the receipts taxable under Income from other sources? Assume that its only a one time transaction.
11 February 2011
Agricultural Land which is not a Capital Assests as per section 2(14) of the Income Tax is not taxable under any head. Any profit on sale of such Agricultural Land is exepted under Income Tax
11 February 2011
Dear Sanjay, in a plethora of judicial precedents, capital gains have been held to be 'deemed income' and therfore, unless specifically taxable, a capital gain a capital receipt not chargeable to tax. As you have quite aptly mentioned, in accordance with the provisions of section 2 (14), the items mentioned above are excluded from the definition of the term 'capital asset'. Therefore, any gain arising from the transfer of such assets is a capital receipt not chargeable to tax.
CAclubindia
