Only official revenue records or evidence from relevant authorities can determine if land qualifies as agricultural under Section 2(14) of the Income Tax Act: Delhi HC
The Delhi High Court recently clarified that a sale deed alone cannot verify a land’s classification as “agricultural” for tax exemption purposes.
In the case Pr. Commissioner Of Income Tax Delhi -11 v. Sangeeta Jain, the court emphasized that only official revenue records or evidence from relevant authorities can determine if land qualifies as agricultural under Section 2(14) of the Income Tax Act. This is crucial because agricultural land sales are generally exempt from capital gains tax.
The court highlighted that the Principal Commissioner of Income Tax (PCIT) rightly invoked Section 263 to revise the assessing officer’s (AO) decision, as the AO had relied solely on a sale deed and an incomplete certificate from the Tehsildar without sufficient inquiry. The ruling reinforces the need for thorough verification and underscores that mere classification in sale deeds doesn’t establish agricultural status for taxation.
The copy of the order is as under:
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