Q: Is profit from sale of agricultural land is chargeable?
Ans: Under section 10(37) of Income Tax Act 1957, income would be exempt provided it fulfils following conditions:
- Assessee should be Individual or a Hindu undivided family
- such land is situate in any area referred to in item (a) or item (b) of sub-clause (iii) of clause (14) of section 2;
- such land, during the period of two years immediately preceding the date of transfer, was being used for agricultural purposes by such Hindu undivided family or individual or a parent of his;
- such transfer is by way of compulsory acquisition under any law, or a transfer the consideration for which is determined or approved by the Central Government or the Reserve Bank of India;
- such income has arisen from the compensation or consideration for such transfer received by such assessee on or after the 1st day of April, 2004
