Controversy whether Capital Gain is chargeable or not

Tax queries 861 views 3 replies

darshit

CA Student

179 Points Joined October 2007

During the F.Y. 2008-09, my client has sold Agriculture situated at Village Shaper of Rajkot District. Shaper is not comprised within the jurisdiction of municipality but local authority is Talukapanchayat and its population is more than 10000.It is more than 8 Kms. far from Rajkot. Land

Now my questions are:

1. Does this land covered within the purview of Capital Assets?

2. Does it make any difference if local authority is Gram Panchayat instead of Taluka Panchayat?

3. Which is/are the basic condition(s) for deciding agricultural land being Capital Asset or outside the definition of Capital Asset?

4. Both the conditions i.e. population of less than 10000 and far more than notified Kms should be satisfied or anyone of these?

Kindly opine elaborately with citation

Replies (3)

HARSHIT KABRA

STUDENT

81 Points Joined December 2008

        As per sec.45 Capital Asset includes :
           - Agricultural land in India, not being a land which is situated in any area within the local limits of any municipality,notified area committee,town commitee or a cantonment board and which has a population of not less than 10000 or which is situated in any area upto a disatnce of 8 kms.from such limits.

As per the facts of the case though the population is more than 10000 but it is outside 8kms. and as per the condiotions of sec. the above mentioned asset does not fall within the perview of sec.45.