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Md Ezaz (Querist)
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16 July 2017 Hello everyone,

I am working in private company and earns 30k. I lost my father in 2013 and for marriage of my sisters i sold my Agricultural Land in Rural area worth 25 lakh in June 2016 and got all amount from Cheque in my Salary account. Now i have to fill ITR this year
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My questions are-

1)Which ITR should i file? ITR-1 or ITR-2 or any other? is ITR-1 only is enough for me??

2)As per my research its Non Capital income so no tax is applicable. So should i disclose this income to Income Tax Department,i am asking because few said that its Excluded income so no need to show even in Exempted income..Plz if someone is sure than plz clarify this as this is very confusing.

Also In some Forum its said i should disclose in OTHER tab under EI. But there is no provision to show from where i got this Money.. If i will just write 25 Lakh in OTHER under EI will it lead to problem in future as IT deptt will not know from where i got this money...

Kindly answer this 2 question, i will be Thankful to you.

Anand

Anand (Expert)
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17 July 2017 1. First of all, you must be able to prove that the income from sale of land is exempt. For this you need to establish that the land in question, was an Agricultural Land meeting the criteria laid out for it to be treated as not being a Capital Asset.
For this purpose, it should satisfy EITHER of the following
a) The land should not be situated in an area comprised within the jurisdiction of a muncipality/municpal corporation/notified area committee/town area committee/town committee/cantonment board having a population of 10,000 or more.
b) The land should not be situated in any area within the distance measured aerially
(i) of within 2km from local limits of municipality etc having a population of 10,000 - 1 lakh
(ii) of within 6 km from local limits of municipality etc having a population of 1 lakh - 10,00,000
(iii) of within 8km from local limits of municipality etc having population of > 10,00,000/-
population figures to be considered as per last preceding census.
Also note that for the land to be considered Agricultural Land for Income Tax Purposes. Please ensure that these criteria are met before considering the land sold as not being a Capital Asset.
In the event that your land is considered an Agricultural Land meeting the above criteria for it be not taxable, then you would be better off filing your ITR as ITR2 wherein you can show this income as being Exempt under the head Exempt Income.
Yes, it may create an issue with the department wanting to verify the large source of income claimed to be not taxable. But please note that the registrar of land records also reports to the tax department under CIB-151 Transfer of Immoveable Property. The limit for this is not known (unlike AIR where only property sale of more than 30 lakhs is reported) So you can take a chance one way or the other.