Taxation on sale of agricultural land

This query is : Resolved

Sheetal Patel (Querist)
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07 May 2016 It would be my pleasure to seek an expert opinion regarding taxation on sale of agricultural land.

The case is below;
1. Assessee : Farmer not filing ROI (Having PAN)
2. Agricultural land located at : Rural Area away from the limit of municipality
3. Purchased in : December 2015 for a consideration of Rs.30 lacs
4. Sold in : May 2016 for a consideration of Rs.1 cr
According to my knowledge, the above mentioned transaction does not attract any tax liability.
However, I would like to seek your opinion on my knowledge/understanding.

Your reply would be highly appreciated and helpful.

CA VISHNU GAVKARE

CA VISHNU GAVKARE (Expert)
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09 May 2016 Dear Sheetal,
Your view is correct. Land in specified area is not covered in defination of capital asset, hence not liable for tax.

Sheetal Patel

Sheetal Patel (Querist)
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09 May 2016 Vishnu sir,
Thanks a lot for your reply.

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CS Advocate Abhishek Goyal

CS Advocate Abhishek Goyal (Expert)
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09 May 2016 An agricultural land located beyond the specified areas measured arrially are not capital assets:

1. In case of population of nearest municipality is 10000-100000 2 km.
2. In case of population of nearest municipality is 100000-1000000 6 km
3 In case of population of nearest municipality is 1000000 or more 8 km

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