“Agriculture Land” Redefined with New Limits as Capital Asset

Meaning of ‘capital asset’ toned up in line with change of meaning of ‘agriculture land’

Current Provision:

Sec. 2(14) defines capital asset being property of any kind held by an assessee whether or not connected with business or profession. Certain categories of properties including agricultural land have been excluded from this definition.

The existing definition provided that a land will not be called agricultural land if

(i) it is situated in an area of municipality etc. having population not less than 10,000 according to last census; or

(ii) land situated in an area within the distance not exceeding 8 kilometres from the local limits of any municipality etc.

Proposed Provision:

The proposed amendment provides that a land to be called agriculture land should not be situated

(1) in an area within 2 kilometers of local limits of municipality etc., these 2 kilometers shall be measured aerially, and population of municipality etc. is more than 10,000 but not exceeding 1,00,000; or

(2) such land should not be situated within 6 kilometers of the municipality having population of more than 1,00,00 but not more than 10 lacs; or

(3) such land should not be situated within 8 kilometers if population of municipality etc. is more than 10 lacs.

These amendments are in tune with amendments made in Sec. 2(1A). The definition is more liberalized and will provide benefit to those farmers whose land is near inhabited areas because of increase in population. It also accepts the courts view that distance should be measured aerially.

Advertisement

No comments yet.

Leave a Comment

Popups Powered By : XYZScripts.com
84 queries in 1.915 seconds.