Dear Expert,
I have a query in the case of the sale of Agriculture land which was purchased by the Private Limited Company for INR 9 lacs in the year 2007 and sold for INR 21 Lacs in March 2022. The Company is in the business of Agriculture. They have already given an advance for the purchase of new agricultural land for agricultural business.
Is Capital Gain Tax applicable for this Company?
Furthermore, Before selling the land they converted the agricultural land to industrial land for agriculture purposes.
Thanks in Advance
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Urgent-Capital Gain for Private Ltd Company
Replies (1)
llustration
Mr. Raja purchased an agricultural land in April, 2017. Since the date of purchase, the
land was being used for agricultural purpose. The land was sold in July, 2022 for Rs.
8,40,000. Capital gain arising on sale of land amounted to Rs. 1,00,000. Can he claim the
benefit of section 54B by purchasing another agricultural land?
**
Exemption under section 54B can be claimed in respect of capital gains arising on
transfer of capital asset, being agricultural land (may be long-term or short-term).
This benefit is available only to an individual or a HUF. The land should be used for
agricultural purpose at least for two years. In this case, all the conditions of section 54B
were satisfied and, hence, Mr. Raja can claim the benefit of section 54B by purchasing
another agricultural land within the time-limit specified under section 54B.
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