• Definition of qualification of agri land as rural agri land

I sold my inherited agri land acquired much before of 1981 deposited the sale consideration after indexation from year 2000 onwards n later came to know that entire sale consideration stood to be deposited under section 54F, hence now I am subjected to paying capital gain on the indexation amount deducted from sale consideration.

Later I have come to know that if it is rural land n being regularly under crop cultivation since acquired , is not capital asset for capital gain.
How can I now represent my asset as rural agri land and be exempt from the provisions of such. The land is outside the munciple limits n as there are no tax naaka to measure the distances as prescribed, how to go about it. As per Google distance, the distance from muncpality office shows 7.2 km n the population of city little less than six lakh on Google.
Asked 12 days ago in Capital Gains Tax


To determine whether the land you have sold is covered within rural agricultural land or not, you need to be aware of below pointers specific to your case.

1. The population of the city should be taken as per last census i.e 2011 in this case.

2. If I assume that you have mentioned the correct population figures then the given land should be outside the municipal limit and more than 6km away from local limit of the municipality and not the office. 

For detailed discussion and end to end solution on capital gains exemption, I would suggest you to take a telephonic consultation. 


Best Regards, 



Vikram Aggarwal
CA, Gurgaon
46 Answers
6 Consultations

5.0 on 5.0



Rural Agricultural land.


It means an agricultural land in India –


(a) If situated in any area which is comprised within the jurisdiction of a municipality and its population is less than 10,000, or


(b) If situated outside the limits of municipality, then situated at a distance measured-


(i) more than 2 kms, from local limits of municipality and which has a population of more than 10,000 but not exceeding 1,00,000; or


(ii) more than 6 kms, from local limits of municipality and which has a population of more than 1,00,000 but not exceeding 10,00,000; or

(iii) more than 8 kms, from local limits of municipality and which has a population of more than 10,00,000.

We may assist in calculation of capital gain.


Please have a phone consultation for details discussion

Karishma Chhajer
CA, Jodhpur
2423 Answers
26 Consultations

5.0 on 5.0

Have you checked aerial distance?

We need more distance to know whether it is a rural agricultural land or not.

Were you conducting agricultural activity on same?


Hope you find the information helpful if you do please rate it 5 and provide your valuable feedback for my improvement.

Thank you

Naman Maloo
CA, Jaipur
3829 Answers
47 Consultations

5.0 on 5.0

- Either it should be classified as agriculture land in revenue records or some proof to show that agriculture activity was carried on such land. You can obtain the proof from local tehsildar. Generally there is Form J issued by local authority for agriculture income, agriculture area, owner of the land etc. In respect to distance, aerial view of google map would be sufficient. 

- To release the mount of deposit from Capital gain account, submit above documents along with proper justification. If ITR has been already filed, file rectification of ITR.


- For detailed discussion, proper drafting of letter to AO and filing of rectification of ITR, I may assist you. 

Vivek Kumar Arora
CA, Delhi
4135 Answers
365 Consultations

5.0 on 5.0

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