Income Tax Appeal v. M/S. Shagun Infrastructure Private Limited, Nagpur

itl26.11 IN THE HIGH COURT OF JUDICATURE AT BOMBAYNAGPUR BENCH, NAGPUR. INCOME TAX APPEAL NO. 26 OF 2011The Commissioner of Income Tax – I, Nagpur -vs- M/s. Shagun Infrastructure Private Limited, Nagpur ------------------------------------------------------------------------------------------------------------------------------------ Office notes, Office Memoranda ofCoram, appearances, Court's ordersor directions and Registrar's orders. Court's or Judge's Orders. ------------------------------------------------------------------------------------------------------------------------------------Shri Anand Parchure, counsel for appellant.Shri N.S. Bhattad, counsel for respondent. CORAM : SMT. VASANTI A. NAIK &A. S. CHANDURKAR, JJ. DATE : 11.10.2013. By this appeal, the appellant-Department challenges the order of the Income Tax Appellate Tribunal, Nagpur Bench, Nagpur dated 21/04/2011 dismissing the appeal filed by the Department and upholding the order of the Commissioner of Income Tax. According to the appellant-Department, the Commissioner of Income Tax as well as the Tribunal were not justified in deleting an addition of Rs.94,96,455/- as the same was assessable as business income since some of the agricultural lands sold by the respondent was an adventure in the nature of trade. On hearing the learned counsel for the parties and on a perusal of the order of the Commissioner of Income Tax as well as the Tribunal, we find that the finding recorded by both the authorities that the sale of agricultural land by the assessee was not an adventure and could not have been assessed under the head of ‘business income’ is a pure finding of fact based on a proper appreciation of the material on record. The authorities considered that though the respondent-assessee was engaged in the business of infrastructural development, it purchased the agricultural land that was sold in the year 2006, in the year 1999-2000. The land was cultivated by the assessee and the assessee had shown agricultural income during all the previous assessment years. The claim in regard to the agricultural income was accepted by the Assessing Officer during all the previous assessment years. The authorities considered that the land was situated in the Nagpur region and the assessee was registered and acknowledged as a bona fide agriculturist. After the sale of the agricultural land, the authorities held that the assessee reinvested the amount secured by the sale of the same in acquiring another agricultural land in Pune where also the assessee was recognized as a bona fide agriculturist. Considering the fact that the land was situated more than 8 kilometers away from the limits of the Nagpur Municipal Corporation and also the aforesaid facts coupled with the documents that were tendered on record, the authorities found that the assessee had not indulged in adventure in the nature of trade while selling the land and the case of the appellant-Department that the amount was liable to be assessed under the head ‘business income’ was not correct. Since the finding recorded by the Tribunal is a pure finding of fact and does not give rise to any substantial question of law, the appeal fails and is dismissed with no order as to costs. JUDGE JUDGE