PRAKASH TIMAJI DHANJODE Vs. INCOME TAX OFFICER

JUDGEMENT

(1.) We are disposing of these two matters as both relate to the same parties and involving the same property in question.

(2.) The Income Tax Officer, First Survey Circle issued a notice under Section 139 (2) of the Income Tax Act (For short IT Act) calling upon the assessee to file his return of income. In response to the same, he filed his return of income declaring nil income. It was contended by him that the land in question was used for agricultural purposes and, therefore, outside the purview of the definition of the terms 'Capital Asset' within the meaning of the IT Act and, therefore, not liable to capital gain tax. It was observed that he had invested the sale proceeds in the following manner:-

(3.) The same order was challenged in an appeal to the CIT-(A) and by order dated 25.01.1989, it was held that the transaction did not involve transfer of any capital asset, therefore, the assessee was not liable to pay capital gain taxes.