RAMESHWARLAL PUROHIT Vs. COMMISSIONER OF INCOME-TAX

JUDGEMENT

(1.) THE following reference has been made to this Court for opinion: Whether, on the facts and in the circumstances of the case, the Tribunal was justified in holding that the land was non -agricultural land, as the assessee had obtained permission to divert the land for agricultural operations were carried on by way of only a stop gap activity pending sale of the said land?

(2.) COUNSEL for the party aggrieved submitted that the said question is covered by the order of the Gujarat High Court in the case of Himatlal Govindji v. CWT : [1977]106ITR658(Guj) , wherein it is held that when after the agricultural land is diverted for non -agricultural purpose, after the permission to divert the land then even if agricultural operations are carried on the non -agricultural land as a stop gap activity the said character of land will be non -agricultural land. - -

(3.) IT is not in dispute that after the purchase of land by the assessee the intention of the assessee was not to carry on cultivation but to divert the said land for non -agricultural purposes with an intention to develop a residential colony. Layout plan for development of residential colony was approved by the Regional Office, Town and Country Planning, Indore, on February 13, 1979. The assessee moved an application to the Revenue authorities for permission to divert the said land for non -agricultural purposes, i.e., for to develop residential colony. Permission has been granted to the assessee vide order dated June 22,1979, and the divert land revenue of Rs. 2,687.65 per annum is paid by the assessee.