Capital gain agricultural land .

Agricultural land in Rural Area in India is not considered a capital asset. Therefore any gains from its sale are not taxable under the head Capital Gains.

Definition of Rural Area – from AY 2014-15 – Any area which is outside the jurisdiction of a municipality or cantonment board having a population of 10,000 or more is considered Rural Area, if it does not fall within distance(to be measured aerially) given below – (population is as per the last census)

2kms from local limit of municipality or cantonment board -- If the population of the municipality/cantonment board is more than 10,000 but not more than 1lakh.

6kms from local limit of municipality or cantonment board --- If the population of the municipality/cantonment board is more than 1lakh but not more than 10 lakh.

8kms from local limit of municipality or cantonment board-- If the population of the municipality/cantonment board is more than 10lakh

If the population there is more than 10 Lacs according to the last preceeding census of which the relevant figures have been published before the first day of the previous year then it is not Rural Land. So you need to ascertain the folowing 1. Aerial distance 2. Poulation Census where the land referred above is situated. 3. Cantonment board or municipality which is relevant in.your case.

I agree with Mr.shishir and Mr.hitesh.

So Income tax will be applicable on such transaction or not ?

No income tax payable on such transaction , because siliguri population is within 7-8 lacs and land sold situated more than 6 km. hence taxability not arrises .

Sir, How does the following fit in Definition of Rural Area (from AY 2014-15) Any area which is outside the jurisdiction of a municipality or cantonment board having a population of less then 10,000 as per the last census.