Buy of agricultural land

If the land purchased is truly agricultural (and not a capital asset under Section 2(14)), the provisions of Section 56(2)(x) regarding the "deemed income" for the buyer typically do not apply. However, if the department classifies it as non-agricultural land due to its proximity to an urban area, the difference between the Stamp Duty Value and the purchase price may be taxed as "Income from Other Sources" if the difference exceeds 10% of the consideration.