Assessee developed agricultural land into 23 plots and sold them to different persons for residential purposes. AO estimated capital gains by applying S. 50C. CIT(A) held that the income was in the nature of business income as the activity came under the ambit of ‘adventure in the nature of trade’. Tribunal held that conclusion of taxation as business income was justified however, the CIT(A) did not take into consideration the provision of S. 50C. Accordingly, the matter was remanded back to CIT(A). (AY. 2007-08)
Ramswaroop Saudagar v. ITO (2018) 63 ITR 262 (Jaipur)(Trib.)
S. 50C : Capital gains – Full value of consideration – Stamp valuation – Conversion of agricultural land into residential plots – AO applied S. 50C – CIT(A) held that income in the nature of business income therefore, S.50C not applicable – Held, S. 45(2) not taken into consideration and therefore, matter remanded back to CIT(A). [S. 45(2)]