Held that distance between municipal limit and agricultural land was to be measured having regard to shortest road distance and not arial distance. As per certificate issued by Dy. Executive Engineer (Road and Building) distance between municipal limit and agricultural land was 8.5 kilometers, agricultural land was situated beyond 8 kilometers of municipal limit and thus, it was not a capital asset within meaning of section 2(14)(iii)(b) not liable to capital gains tax. Tribunal also held that agricultural land was not a capital asset under section 2(14), application of provisions of section 50C were not applicable. Addition is deleted. (AY. 2012 -13)
Kanchanben Maheshbhai Patel. v. ITO (2025) 212 ITD 133 (Surat) (Trib.)
S. 2(14)(iii) : Capital asset-Agricultural land- Distance between municipal limit and agricultural land was to be measured having regard to shortest road distance and not aerial distance- Agricultural land was situated beyond 8 kilometers of municipal limit- Not capital asset eligible for exemption- land sold was not a capital asset under section 2(14), provisions of section 50C would not apply.[S.2(14)(iiib) 45, 50C]