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ITAT upheld CIT(A)'s denial of claim u/s 54B (of Income Tax Act, 1961)
ITAT upheld CIT(A)'s denial of claim u/s 54B (of Income Tax Act, 1961)
Assessees were co-owners of a piece of land, and sold it and purchased another piece of agricultural land from money received. They claimed deduction u/s 54B (of Income Tax Act, 1961). AO rejected claim and held that land sold was within 8 kms from Pimpri Chinchwad Municipal Corporation, and was not 'agricultural land' u/s 2(1A) (of Income Tax Act, 1961). CIT(A) held s 54B claim was not available as land purchased was not in name of persons to whom capital gain arose. ITAT upheld CIT(A)'s order.-501480
1. The assessees were co-owner of a piece of land,and entered into an agreement with a property developer, and reeived a consideration of Rs 1,60,20,000. Since, the land was owned by five co- owners, the consideration was equally divided among them. The assessees from the sales proceeds of the aforesaid land purchased another piece of agricultural land for Rs 1,50,00,000. On AIR information, notice u/s. 143(2) (of Income Tax Act, 1961) was issued to the assessees. Assessees neither filed return of income nor appeared before the Assessing Officer. They submitted that the land sold was an agriculture landm and therefore, no capital gain was leviable. Assessees claimed deduction u/s 54B (of Income Tax Act, 1961), on investment of sale consideration towards purchase of another piece of agricultural land. AO held that the land sold was located within the distance of 8 km from the local limits of Pimpri Chinchwad Municipal Corporation. He held it did not fall within the definition of 'agricultural land' u/s. 2(1A) (of Income Tax Act, 1961). AO rejected claim of deduction.
2. CIT(A) upheld the assessment and confirmed that assessee was not eligible for deduction u/s 54B (of Income Tax Act, 1961) as the subsequent land purchased was not in the name of the persons to whom capital gain arose.
3. On appeal, the ITAT upheld the CIT(A)'s order, and held:
"4. After perusal of the order of the Commissioner of Income Tax (Appeals) we are of the considered opinion that the order of Commissioner of Income Tax (Appeals) is justified and we do not find any infirmity in the same.”
Case Reference - Shri Omkar Chimaji Zinjurde V/s. Income Tax Officer.
IN THE INCOME TAX APPELLATE TRIBUNAL "B" BENCH, PUNE
BEFORE SHRI R.K. PANDA, AM AND SHRI VIKAS AWASTHY, JM
ITA No. 362/PN/2011
(Assessment Year : 2005-06)
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