| Question And Answer | |
|---|---|
| Subject: | Applicablity of Section 56(2)(vii)(b) on purchase of rural agricultural land -A.Y.2014-15 |
| Category: | Income-Tax |
| Querist: | SURENDRA MEHTA, Advocate |
| Answered by: | Research Team |
| Tags: | Agricultural Income, Agricultural land, stamp valuation |
| Date: | November 12, 2021 |
Rural agricultural land purchased as per documents at Rs. 9,00,000/- and DLC rate was 37,00,000/- (Local stamp duty rate). AO made addition of this difference u/s 56(2)(vii)(b). whether AO’s action is correct when rutal agricultural agricultural land is not subject to capital gain in thehands of saller. Kindly quote case laws on the subject.
Smilar situation is in the A.Y. 2015-16,2016-17 and 2017-18. Kinly guide.
In Premchand Jain v.ACIT ( 2020) 183 ITD 372 ( Jaipur ) ( Trib) dealing with section 56(2) (vii) (b ) of the Act has held that if the agricultural land does not fall in definition of capital asset , difference between district level value and sales consideration cannot be brought to tax . The same principle will apply.
Disclaimer: This article is only for general information and is not intended to provide legal advice. Readers desiring legal advice should consult with an experienced professional to understand the current law and how it may apply to the facts of their case. Neither the author nor itatonline.org and its affiliates accepts any liabilities for any loss or damage of any kind arising out of any inaccurate or incomplete information in this article nor for any actions taken in reliance thereon. No part of this document should be distributed or copied (except for personal, non-commercial use) without express written permission of itatonline.org