1) This exemption is only for compulsory acquisition of
Urban agricultural land
Individual / HUF .
Following condition must be satisfied
(1) Used for Agricultutal Purpose for 2 years
- The land must have been used for agricultural purposes for atleast last 2 years by Individual or his parents.
- In Case of HUF,it should be used for atleast 2 years by Members of HUF
Land Owned by
|Land Used by|
|Individual or his parents|
|Members of HUF|
(2)The compensation or enhance compensation must be received on or after 1/4/2004
1.This exemption is only for Urban agricultural land
Rural agricultures land is anyways not taxable as it is not Capital asset .
2. In Case, Compulsory acquisition done before 1/4/2004
|Compensation received after 1/4/2004||Whole Amount Exempt|
|Some part of compensation received before 1/4/2004 and some later||Whole Amount Taxable|
|Original Compensation recevied before 1/4/2004 but Enhanced Compensation Received on or after 1/4/2004||Original Compensation Exempt, Enhanced Compensation Taxable|