Hi, friends
I have a query regarding Captial gains i,e my assesse sold an Agriculture land owned by him in an village not in an municipal area owned by him to 2 yrs and sold for nominal profit only , My query is whether is he exempt from Captial gains or not .or he is liable to tax
As per my knowledge it is exempt from tax as it is not an captial assset
rectify the above if any mistake
Regards
harish
village land is not a capital asset
Agricultural land situated in rural area is not a capital asset.
Agricultural land is nota capital asset so no capital gain..
You are correct Harish
Capital gain will not arise on sale of Agricultural land.
As per section 2(14),
Agricultural lands situated outside specified areas are not capital assets.
Now a specified area means
1. An area which is comprised within the jurisdiction of a municipality or corporation or cantonment board, and
2. Any area which is within a distance of 8 kms from such municipality or cantonment board or corporation, (which has a population of not less than 10,000 as per the last preceding census, the results of which have been published before the first day of the relevant previous year), which has been notified in this behalf.
There is no taxability of the same under income tax act, if agricultural land is outside a specified area.
Your view appears correct.
Regards
Thanks for replies friends..................
RURAL AGRICULTIRE LAND IS NOT A CAPITAL ASSET THEREFORE IT SHOULD BE TAXABLE ON OTHER HEAD.
| Originally posted by : Ankit Jain | ||
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You are correct Harish Capital gain will not arise on sale of Agricultural land. |
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