Capital gain issue in agricultural land sale

Q.I own some agricultural land which I had bought for Rs 25,000 in 1972. I want to sell that land and the expected price is Rs 80,00,000. The land is in a rural area which comes under gram panchayat with village population of around 900. From my land the nearest Nagar Panchyat and taluka city is 12 km. I want to know will I have to pat capital gain tax?

— Nidhish

A.The agricultural land in India, not being land situate -

• Within the jurisdiction of a municipality (whether known as municipality, municipal corporation, notified area committee, town area committee, town committee or by any other name) or a cantonment board having a population of not less than 10,000 according to the last preceding census of which the relevant figures have been published before the first day of the previous year.
• In any area within the distance measured aerially,
• not being more than two kilometers, from the local limits of any municipality etc; or cantonment board as referred to in (a) above and which has a population of more than ten thousand but not exceeding one lakh; or
• not being more than six kilometers, from the local limits of any municipality etc; or cantonment board as referred to in (a) above and which has a population of more than one lakh but not exceeding ten lakh; or
• not being more than eight kilometers, from the local limits of any municipality etc; or cantonment board as referred to in (a) above and which has a population of more than ten lakh.
•  is not treated as a capital asset, and therefore, any profit arising on the sale thereof is not an exigible to income tax. On the basis of the facts given in the query it seems that the agricultural land owned by you is not covered within the area mentioned in (a) above or within the distance mentioned in clause (b) above. It would be advisable in this case to confirm that the distance stated to be 12 kilometers from the city remains same or beyond 8 kilometers if it is measured aerially. A Tehsildar should be able to confirm this aspects. A certificate from Tehsildar should be obtained certifying that the land is not situated within the municipality etc. and is not covered within the distance measured aerially from the municipality or such like authorities specified hereinabove. Such a certificate should be kept on record so that it can be produced as and when required by the tax authorities.