PRINCIPAL COMMISSIONER OF INCOME TAX AAYAKAR BHAVAN, KOZHIKODE Vs. KALATHINGAL FAIZAL RAHMAN ROSE VILLA , FEROKE KOZHIKODE

JUDGEMENT

(1.) The Revenue is in appeal raising substantial questions of law against the order of the Income Tax Appellate Tribunal, which affirmed the order of the first appellate authority finding the sale of the assessee's land to be not assessable as capital gains under Section 45 of the Income Tax Act, 1961 ('Act', for short). The questions of law framed are the following, as seen from the memorandum :

(2.) The learned Standing Counsel for the Revenue submitted that the assessee is a partner in various firms and has also substantial land holdings. The assessment as carried out for the year 2010-2011 was with respect to sale of a property having an extent of 42 acres in Survey No.485 and Re-survey No.146/2 of Chelembra Amsam. The property was sold for a total consideration of Rs. 3,38,63,200/-. The said property was purchased in the year 1981 by the father of the assessee and devolved on the assessee on the death of his father. The property was purchased, from the assesee, by the owners of a newspaper, who have later made constructions thereon wherein the offices and press of their Calicut edition is now located.

(3.) The assessee had not declared any capital gains in the return of income filed for the year, and on scrutiny under Section 143 of the Act, the specific sale was sought to be assessed as capital gains. The only evidence produced by the assessee to prove that the land was agricultural land, was a certificate issued by the Village Officer, which was found to be not reliable. The learned Standing Counsel relies on [Smt.Asha George v. Income Tax Officer, (2013) 351 ITR 123 (Ker)] to contend that such certificates issued long after the sale cannot be the basis of a conclusion as to whether the property was agricultural land or not. The learned Standing Counsel has also relied on [Sarifabibi Mohmed Ibrahim and Others v. Commissioner of Income Tax, (1993) 204 ITR 631 (SC)] in which certain tests were laid down, which were specifically looked into by the Assessing Officer (AO), to negative the claim of the assessee.