Capital gain tax

Nitesh Umate (Querist) 29 March 2024 This query is : Resolved
When I purchase the land it was urban agriculture land but 2-3 months before my selling of this land it become non agriculture land. So can i take exemption of capital gain tax reinvesting the money to another agriculture land?

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If you sell urban agricultural land that later becomes non-agricultural, you generally cannot claim an exemption from capital gains tax, even if you reinvest the money into new agricultural land. Profits from urban agricultural land are considered capital gains and are taxable. However, land classified as agricultural in a rural area is typically exempt. It's advisable to consult a tax professional for clarification on your specific circumstances.

Isaac Gabriel (Expert) 29 March 2024
Yes.nevrhtless get it clarified with Tax professional.

T. Kalaiselvan, Advocate (Expert) 29 March 2024
Agricultural land situated in a rural area is not classified as a capital asset, hence the profit from its sale is exempt from income tax. In contrast, gains from the sale of urban agricultural land fall under the category of 'capital gains' and are subject to income tax.
Urban agricultural land qualifies as a capital asset; hence capital gains shall arise on the sale or transfer of urban agricultural land.
Therefore you cannot claim any relief or exemption from paying capital gains tax in this situation

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