19 January 2014
IN THE INCOME TAX APPELLATE TRIBUNAL, AGRA BENCH, AGRA BEFORE SHRI P.K. BANSAL, ACCOUNTANT MEMBER AND SHRI H.S. SIDHU, JUDICIAL MEMBER ITA No. 195/Agra/2010 Asstt. Year : 2006-07 A.C.I.T. -3, vs. Gaurav Khandelwal, Mathura. 1, Anand Vihar, Raman Reti, Vrindavan, Mathura. (PAN : AGVPK 0692 H) (Appellant) (Respondent) For Appellant : Shri Vinod Kumar, Jr. D.R. For Respondent : S/Sri J.L. Verma, Anil Verma, Advocates ORDER Per P.K. Bansal, A.M. : This appeal has been filed by the Revenue against the order dated 05.03.2010 of the CIT(A)-I, Agra. 2. The only dispute involved in this appeal relates to the measurement of distance for the purpose of agricultural land within the meaning of section 2(14)(iii)(b) of the Income-tax Act. The assessee took that the distance should be taken through the approach road while the Assessing Officer has taken the Arial distance and accordingly held that the land sold by the assessee is a capital asset as being situated within 8 Kms. of the Municipal Limit. The assessee went in appeal before the CIT(A). The CIT(A) held the land to be an agricultural land and not a capital asset by holding as under : “3.2. On the above issue, the Hon’ble P&H High Court in the case of CIT vs. Santinder Pal Singh 33 DTR 281(P&H)(2010) has approved the decision www.lexpertsonline.com2 of Hon’ble ITAT Mumbai in the case of Laukik Developers Pvt. Ltd. The conclusion is reproduced as under :- “Distance of the agricultural land belonging to the assessee within the meaning of s. 2(14)(iii)(b) has to be measured in terms of the approach by road and not by the straight line distance on horizontal plane or as per crow’s flight.” 3.3. Accordingly, the AO is directed to consider the appellant’s case in the light of the above decision to determine whether the impugned land is a capital asset within the meaning of section 2(14) or not and give relief, if due.” 3. We have heard the rival submissions and carefully considered the same. The learned DR although vehemently relied on the order of the Assessing Officer, but could not submit any case law contrary to the decision of Punjab & Haryana High Court in the case of CIT vs. Satinder Pal Singh, 33 DTR 281 (supra). The learned AR of the assessee, on the other hand, relied on the order of the Delhi Bench in the case of Shri Hukmi vs. DCIT in ITA No. 2582/Del./2004 in which we noted that the Tribunal under para 8 has held as under : “8. As regards the issue relating to the exact nature of land belonging to the assessee, it is observed that the said land was held to be an agricultural land by the learned CIT(A) after taking into consideration the evidence filed by the assessee in the form of copy of Khasra Girdawari and the Revenue having not filed any appeal or cross-objection against the said inference drawn by the learned CIT(A), this issue has reached finality. The action of the AO in treating the said land as a capital asset and bringing the profit arising from sale thereof to tax in the hands of the assessee as long term capital gain, however, was upheld by the learned CIT(A) relying on the evidence brought on record by the learned CIT, Rohtak during the course of proceedings u/s. 263 in the form of certificates issued by the concerned authorities sating therein that the said land was situated within 8 Kms. from the municipal limit. As pointed out by the learned counsel for the assessee at the time of hearing before us, the said distance was certified as 7.5 kms. from the municipal limit by the concerned authority on the basis of a suggestion given by the learned CIT, Rohtak to measure such distance on a straight line method on horizontal plane according to section 11 of the General Clauses Act. This method followed by the concerned authorities as per the suggestion given by the learned CIT, Rohtak to measure the distance has been challenged by the learned counsel for the assessee relying on the decision of Mumbai Bench of ITAT in the case of Laukik Developers vs. DCIT 105 ITD 657 wherein it was held, following the decision of Pune Tribunal in the case of www.lexpertsonline.com3 Mangalam Inorganics Pvt. Ltd., that the distance between the municipal limits and assessee’s industrial undertaking is to be measured having regard to the shortest road distance and not as per the crow’s flies, i.e., a straight line distance as canvassed by the Revenue. The learned DR has contended in this regard that the said decision has been rendered by the Mumbai Bench in the case of Laukik Developers in the context of the provisions of section 80IB(10) and not in connection with the issue of determining a capital asset within the meaning of section 2(14). It is, however, observed that in the case of Mangalam Inorganics Pvt. Ltd (supra) relied upon by the Mumbai Bench, the decision was rendered by Pune Bench of ITAT in the context of the issue of capital asset u/s. 2(14) as involved in the present case and this being so, we set aside the impugned order of the learned CIT(A) and restore the matter to the file of the Assessing Officer for deciding the same afresh after ascertaining the exact distance of the land in question from the municipal limits by adopting the method as given in the aforesaid orders of the Tribunal. The grounds raised by the assessee on this issue thus are treated as allowed for statistical purposes.” 4. Respectfully following the decision of the co-ordinate Bench and that of Punjab & Haryana High Court, we confirm the order of the CIT(A) and dismiss the appeal filed by the Revenue. 5. In the result, the appeal filed by the Revenue is dismissed. The order pronounced in the open court on 30.6.11. Sd/- Sd/- (H.S. SIDHU) (P.K. BANSAL) Judicial Member Accountant Member Dated: 30 th June, 2011 *aks/- Copy of the order forwarded to : 1. Appellant 2. Respondent 3. CIT(A) By order 4. CIT, concerned 5. DR, ITAT, Agra 6. Guard file Assistant Registrar True copy www.lexpertsonline.com
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