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Income tax query

Pravindra Ranjan Choudhary (self ampoloyed) (50 Points)

01 January 2018

I have inherited an agricultural land out of urban area in 1990 and I have sold it at 200000 in f.y.-2017-18
I want to know if this is taxable or not?, if it is under the burdern of tax liability then under which section?
Please provide me your suggestions.
Happy New Year to all the respectable law associates.

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5 Replies

chamarthi venkatesh (Student CA Articleship) (848 Points)
Replied 01 January 2018

Agriculture land will not be treated as capital asset for the purpose of capital gains
So, your transaction is not taxable

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Dhirajlal Rambhia (SEO Sai Gr. Hosp.) (182233 Points)
Replied 01 January 2018

Urban agricultural land is capital asset, and its transfer is taxable under capital gains.......

Dhirajlal Rambhia (SEO Sai Gr. Hosp.) (182233 Points)
Replied 01 January 2018

Exemption under section 54B can be claimed in respect of capital gains arising on transfer of capital asset, being agricultural land. This benefit is available only to an individual or HUF.

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Anurag lohiya (Bara bazar) (262 Points)
Replied 01 January 2018

Dear Pravindra Ranjan Choudhary,
Agricultural land situated in Urban area is treated as Capital asset by virtue of section 2(14). (subject to fullfillment of conditions )
You have inherited the same then it will be taxable in hands of you.
COA shall be COA in hands of previous owner.
Period of holding shall of previous owner shall be included in your period of holding. ( Section 2(42A)).
Apply second proviso to section 48 i.e. Indexation.
Amount forfieted if any by the prevvious owner shall not be dedcueted from the COA
Amount forfieted by you after 1.4.2014 Shall not be deduted by virtue of section 51 and 56(2)(ix).
Case of RM arunachalam (SC) is relevant for you.
Compute Capital gain u/s 48.
Tax exemption u/s 54B if agricultiral land is purchased by you utilising that Capital Gain amount.
Hope this will help you out.
Thanks.

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