Whether the income will be considered as capital gain ?

Rural agriculture land is excluded from the definition of the capital asset. So compulsory acquisition of such rural agriculture land is not to be treated as transfer and no capital gain is attracted.

In case if in the above case the land is urban land , how the amount will be chargeable then ?

If it is urban land, then such compulsory acquisition is a transfer and hence tax is levied on capital gains. In this case, the transfer is in the nature of compulsory acquisition, so the tax on capital gains is not to be paid in the year of transfer, but should be paid in the year of amount of compensation received. Even though partial amount of compensation is received,( i.e., instalments)tax on capital gains is to be paid on the whole amount of compensation. But in case of enhanced compensation (if any) it should be taxed in the year of receipt.

Agricultural land can be owned ONLY & ONLY by ancestral farmers and strictly not otherwise.

Hence by this logic, the Agri land rural / Farm-houses can be sold and purchased ONLY & ONLY by farmers / agriculturists and not otherwise, UNLESS AND UNTIL the agricultural land has been duly converted to non-agricultural and THEN a house has been built over it.

A bungalow or a holiday-home built over agricultural land, is not a Farm-house, and would be illegal & unauthorized and subject to demolition by the area tehsildar / collectors office.
In which state/district the agri rural land is located ? and Holding since when ? 
in nutshell, Pvt LTD company generally  can not own Agri Land (Rural or urban)

If the Pvt LTD company can not own Agri land, whether the capital gain will arise in books of directors ? The land is recorded as an fixed asset in the company's books. what shall be the treatment of the same ??

@ jaya krishna i
Since this agriculural land belongs to the company any compensation received will be paid by the railways to the company in that year.
The taxability depends on the location of the land since its located in rural areas its taxabile and will get benefit under Sec 54, Sec 54F and Sec 54EC.
But it is licated in specified urban areas its taxable.

1. Compulsory acquisition of land (other than Agri land) will be taxable under sec 45(5) as capital gains in the year of receipt of compensation for such compulsory acquisition. 
2. In your case, directors have signed the agreement only on behalf of a private ltd company. That does not give them any right over the land. Whatever the amount received will only be taxable in the hands of a Private limited company. Directors merely act as representatives of the company and no way they can hold ownership of the property belonging to the company. 
3. As explained by Pravin Ji, agriculture land cannot be held by Private Ltd Company. Individual or HUF holding agriculture land and if the same is compulsorily acquired by the government then the same will be exempted u/s 10(37) of the act. 
4. The fact of how it came into the books of private ltd company is a big question. Registration of land would not be allowed to a private limited company. Of course there are few exceptions under which a company can own a land (if it is engaged in agricultural activity ) but still, it has a lot of restrictions subject to approvals from many government officials and departments. 
Please correct me if the above solution has an alternative view. 

@ Mr. Suresh
I hv a different view altogether.
But its truth.
There are many agricultural lands in India.
Nowadays organic farming is very .
Many private limited co. are selling farm produce at special rates.
These are free from pesticides.

Originally posted by : sabyasachi mukherjee
	@ jaya krishna i Since this agriculural land belongs to the company any compensation received will be paid by the railways to the company in that year.The taxability depends on the location of the land since its located in rural areas its taxabile and will get benefit under Sec 54, Sec 54F and Sec 54EC.But it is licated in specified urban areas its taxable.

RURAL AGRICULTURAL LAND TAXABLE TO PVT LTD CO. AS WHAT ?   BENEFITS UNDER 54, 54EC, 54F  !!!!    What is meant by specified urban areas taxable ??       KON SI KITAB MEIN HAI YE SAB