Dismissing the appeal of the revenue the Court held that ;.assessee was an agriculturist and, land owned by him had been shown as agricultural land in revenue records . land in question was sold by assessee after a period of 16 months from purchase and, thus, it could not be a regarded as a case of ‘adventure in nature of trade’. Intention of purchaser could not be a determinative factor to treat profit earned by assessee on sale of agriculture land as business income. ( AY.2009 10)
PCIT v. Heenaben Bhadresh Mehta. (2018) 409 ITR 196/ 257 Taxman 219 (Guj)(HC)
S.2(14)(iii): Capital asset-Agricultural land- Adventure in the nature of land – Land was sold after a period of 16 months-Land shown as agricultural land in revenue records- Fact that said land had been sold to an industrial unit and had potential to be used for industrial purpose, could not be a determinative factor to treat profit earned by assessee on sale of agriculture land as business income- The intention of the purchaser cannot be the determinative factor to treat the profit earned by the assessee on sale of agriculture land as business income. .[ S.28(i), 45 ]