Case Note & Summary
The present appeal arises from an order of the Income Tax Appellate Tribunal, 'C' Bench, Ahmedabad, which had not adjudicated upon an additional ground raised by the appellant regarding the Motera Land being a rural agricultural land and thus not a 'capital asset' under Section 2(14) of the Income Tax Act, 1961. The appellant, Baldevbhai F Patel (through legal heir Sanjay B Patel), challenged this before the Gujarat High Court. The High Court framed a substantial question of law on this issue. However, at the outset, both parties submitted that the matter may be remanded to the Tribunal in light of an earlier order dated 27.02.2024 passed by a coordinate bench in Tax Appeal No. 767 of 2023, which arose from the same common order dated 06.01.2021 and involved the son of the present appellant on an identical issue. The coordinate bench had set aside the common order and remanded the matter. The High Court, noting that the substantial question of law was pari materia to that already answered in the son's case, decided to pass a similar order. Consequently, the High Court allowed the appeal, set aside the impugned order of the Tribunal, and remanded the matter back to the Tribunal for fresh adjudication on the additional ground, to be decided in accordance with law and on its own merits. The court also directed that the parties may raise all contentions before the Tribunal.
Headnote
A) Income Tax - Capital Asset - Rural Agricultural Land - Section 2(14) Income Tax Act, 1961 - The issue pertains to whether Motera Land is a rural agricultural land not exigible to tax as it is not a 'capital asset' under Section 2(14) of the Act. The High Court, following its earlier judgment in the case of the appellant's son, remanded the matter to the Tribunal for fresh adjudication on the additional ground. Held that the matter be remanded in light of the coordinate bench's order dated 27.02.2024 in Tax Appeal No. 767 of 2023 (Paras 4-6).
Issue of Consideration
Whether the Income Tax Appellate Tribunal was right in law in not adjudicating upon the additional ground of appeal with respect to Motera Land being a rural agricultural land not exigible to tax by not being a 'capital asset' within the definition as prescribed u/s. 2(14) of the Income Tax Act, 1961?
Final Decision
The appeal is allowed. The impugned order of the Income Tax Appellate Tribunal is set aside. The matter is remanded to the Tribunal for fresh adjudication on the additional ground, to be decided in accordance with law and on its own merits. The parties may raise all contentions before the Tribunal.
Law Points
- Remand
- Additional Ground of Appeal
- Capital Asset
- Rural Agricultural Land
- Section 2(14) Income Tax Act
- 1961
- Pari Materia
Case Details
R/TAX APPEAL NO. 20 of 2026
A.S. Supehia, Pranav Trivedi
Ms. Vaibhavi K Parikh for the Appellant, Dev D Patel for the Respondent
Baldevbhai F Patel by LHS Sanjay B Patel
The Income Tax Officer, Ward 2(1)(1), Ahmedabad
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Nature of Litigation
Tax Appeal under Section 260A of the Income Tax Act, 1961 against the order of the Income Tax Appellate Tribunal.
Remedy Sought
The appellant sought adjudication on the additional ground that Motera Land is a rural agricultural land not exigible to tax as it is not a 'capital asset' under Section 2(14) of the Act.
Filing Reason
The Income Tax Appellate Tribunal did not adjudicate upon the additional ground of appeal regarding the Motera Land being a rural agricultural land.
Previous Decisions
The Income Tax Appellate Tribunal passed a common order dated 06.01.2021 which was set aside by the High Court in Tax Appeal No. 767 of 2023 in the case of the appellant's son, and the matter was remanded.
Issues
Whether the ITAT was right in not adjudicating the additional ground regarding Motera Land being a rural agricultural land not a capital asset under Section 2(14) of the Income Tax Act, 1961?
Submissions/Arguments
Both parties submitted that the matter may be remanded to the Tribunal in light of the order dated 27.02.2024 in Tax Appeal No. 767 of 2023 arising from the same common order and involving the son of the appellant on an identical issue.
Ratio Decidendi
Where a coordinate bench has already remanded an identical issue in a related case arising from the same common order, the court should follow the same course and remand the matter for fresh adjudication on the additional ground.
Judgment Excerpts
The following substantial question of law arise in the present appeal: (i) Whether, in the facts and circumstances of the case, the Income Tax Appellate Tribunal was right in law in not adjudicating upon the additional ground of appeal with respect to Motera Land being a rural agricultural land not exigible to tax by not being a 'capital asset' within the definition as prescribed u/s. 2(14) of the Income Tax Act, 1961?
Under the circumstances, pari materia substantial question of law which are already answered by the Coordinate Bench in the judgment dated 27.02.2024 in Tax Appeal No. 767 of 2023 in case of the son of the present appellant, relating to the very same land, this Court is inclined to pass similar order.
Procedural History
The Income Tax Appellate Tribunal passed a common order dated 06.01.2021. The appellant filed Tax Appeal No. 20 of 2026 under Section 260A of the Act. A coordinate bench in Tax Appeal No. 767 of 2023 (son's case) set aside the common order and remanded the matter on 27.02.2024. The present appeal was heard on 21.01.2026 and remanded following the same course.
Acts & Sections
- Income Tax Act, 1961: 2(14), 260A
