LIVE GST Certification Course by CA Arun Chhajer begins 27th April. Register Now!!

Capital gain

ANJALI NEGI (Chartered Accountant) (1263 Points)

17 October 2012

Income from sale of Urban land is taxable or not???

Reply
Follow
Share

11 Replies

CA Manish (Job) (5264 Points)
Replied 17 October 2012

Urban Land is a Capital Assets therefore gain on sale of urban land is taxable whether it is agricultural or not.

1 Like

KARANDEEP,CA,B.Com,CS FNL (JOB) (457 Points)
Replied 17 October 2012

Any Income derived from a Capital asset movable or immovable is taxable under the head Capital Gains under Income Tax Act 1961. The Capital Gains have been divided in two parts under Income Tax Act 1961. One is short term capital gain and other is long term capital gain.

URBAN LAND IS CAPITAL ASSET, THUS TAXABLE.

THANKS & REGARD

CA KARANDEEP

1 Like

ANJALI NEGI (Chartered Accountant) (1263 Points)
Replied 17 October 2012

Is sale of rural agricultural land taxable or not???

CA Manish (Job) (5264 Points)
Replied 17 October 2012

Not Taxable.

ANJALI NEGI (Chartered Accountant) (1263 Points)
Replied 17 October 2012

Why it is not taxable ??? Can u give me a specified section or a valid reason Sir.

CA CMA Amit Patel (-) (72 Points)
Replied 17 October 2012

As Urban Land is a Capital Assets as per defination of Capital Assets, gain on sale of urban land is taxable under capital gain head of Income however benifit of exemption section of 54 B can be avaled if it is sale of Urban Agri.Land and invesment is made as per conditions.

1 Like

CA Manish (Job) (5264 Points)
Replied 17 October 2012

Sec 2 (14) defines the capital assets.

and the some of the assets are specifically excluded from the definition of capital assets

One of them isAgricultural land in India other than the following:

1.Land situated in any area within the jurisdiction of municipality, municipal corporation, notified area committee, town area committee, town committee, or a cantonment board which has a population of not less than 10,000 according to the figures published before the first day of the previous year based on the last preceding census.

2.Land situated in any area around the above referred bodies upto a distance of 8 kilometers from the local limits of such bodies as notified by the Central Government .

archana bakshi (Student) (227 Points)
Replied 17 October 2012

can anyone pls tell me why profit on sale of rural agricultural land nt taxable under the hewad income frm othr sources??Pls quote the sectrion or give a valid reason.I know since its nt a capital asset hnce it wont be txable undr capitral gain head....

(Guest)

As per my knowledge...... Agriculture income is exempt under section 10. now the qns is that why profit on sale of rural agriculture land is not taxable under head other sources.... this case is related to the judjments of high courts.... According to the view taken by Hon'ble the Bombay High Court the profit arising from sale of agricultural land is agricultural income. On the other hand, according to the Karnataka High Court it is not so. We would, therefore, follow the Bombay judgment which is favourable to the assessee...... you may also follow the judgement of karnataka high court... according to that it is not agriculture income... and we may shown in other sources...

1 Like

(Guest)

in case of contradiction between two HC judgements, as per Allahabad High Court, When two different views are possible, a view which is favourable to the assessee has to be taken.