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Regarding sale of land

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This query is : Resolved

Divyesh Ajmera (Querist)

03 March 2025 • The agriculture land was purchased in FY 2005.
• It was converted to non-agricultural land in FY 2014.
• It was shown as an investment in the 2016-17 ITR
• After 2016-17, ITR 4 has been filed, meaning no balance sheet has been uploaded.
• Other land and plot sold and shown as business income in FY 2021-22 and FY 2022-23
• Some of the sub-plot sold (from converted non agriculture land in 2014) shown as capital gains in FY 2023-24. Remaining sub –plots sold in FY 2024-25 with sales consideration of approximately 5,00,00,000/-.
• The crucial question is whether the 2024-25 sale should be treated as a capital gain or business income.
• Can Section 54F be claimed.
•

Dhirajlal Rambhia

Dhirajlal Rambhia (Expert)

04 March 2025 If the land was transferred to business, capital gain would not occur on such PGBP income, but it will be treated as profit. As such exemption u/s 54F cannot be claimed over business income.

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