Income tax on capital gain
Querist :
Anonymous
(Querist) 19 December 2011
This query is : Resolved
guide income tax on capital arising from inhritent agricaltue property.
I do not know the agricalture land in muncipal limit or not
it is inherited agricalture land . under which sec of income tax it is exempted
Raj Kumar Makkad
(Expert) 19 December 2011
There is no income tax chargeable over the income derived from agricultural land whether it is situated within or outside municipal limit. Even capital tax is not chargeable accordingly.
Querist :
Anonymous
(Querist) 19 December 2011
the reply is benificial & perfect . But I want to know under which sec. of income tax it is exempted.
Sanjeev
(Expert) 19 December 2011
The sale of agricultural land would not attract Capital gains tax if it has been used for agricultural purpose for 2 years prior to disposal.
sec 2(14), capital Assets doesnot cover agreeculture land which is in rural area, it is exception to the defination of capital Asset therefore no tax on the above item....
Since rural land is not covered in the defination of capital assets so it does not attract tax but depends if you meet the defination of rural area as below:
agricultural land in India, not being land situate
(a) in any area which is comprised within the jurisdiction of a municipality (whether known as a municipality, municipal corporation, notified area committee, town area committee, town committee, or by any other name) or a cantonment board and which has a population of not less than ten thousand according to the last preceding census of which the relevant figures have been published before the first day of the previous year ; or
(b) in any area within such distance, not being more than eight kilometres, from the local limits of any municipality or cantonment board referred to in item
Sailesh Kumar Shah
(Expert) 19 December 2011
Agricultural land situated at Rural Area is exempt from income tax. However, In urban area, there is no exemption.
Devajyoti Barman
(Expert) 19 December 2011
What is your state as the states have got different tax rules for different states.
In WB it is not so exempted. You need to pay capital gains tax.
Sailesh Kumar Shah
(Expert) 19 December 2011
Barman sir,
Matter related to income tax. In India, Income tax rules are same in each state.
