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tax on sale of agriculture land

anshul tiwari (Student CA IPC / IPCC) (261 Points)

29 November 2018

If government purchasing land for expressway purpose and giving compensation amount for that. Is it taxable if taxbale then in which head and section

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Mayur Patil (Article) (1276 Points)
Replied 29 November 2018

Is it rural agricultural land or urban agricultural land?

If rural agricultural land then as per sec 2(14) rural agricultural land not considered as capital asset so CG not arise onn rural agricultural land.

If it is urban agricultural land then make sure is it compulsory acquisition or voluntary?

If compulsory acquisition then its exempt u/s 10(37) and if voluntary acquisition taxable as per period of holding (short term or long term)

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MOHAMMED IMRAN (1020 Points)
Replied 29 November 2018

yes it is taxable, except in case of rural agricultural land (not a capital asset)
under capital gains
LTCG in case land is held more than 24 months
capital gains charging section [section 45]
it is taxable in the year in which compensation or part compensation is received
but indexation benefit is available upto the year of acquisition