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5. We have heard both the sides, perused the materials available on record and gone through the orders of authorities below. The assessee is a partnership firm formed on 26th day of December, 2009 with the following partners:

      a.     VGN Enterprises P. Ltd.
      b.     VGN Well Built Properties P. Ltd.
      c.     Mr. V N Devadoss

The companies which had joined as partners (a) and (b) are renowned real estate and property development companies and the other partner Mr. Devadoss is the promoter of those companies. As per the partnership deed, the main object of the firm is to carry on the business of real estate development, property development, builders, civil contractors, buyers, sellers, developers of land into housing plots/sites. The partners have introduced their land worth ₹.4.54 crores (being land in Melpakkam village) as capital contribution. As per clause 2 of the partnership deed, the partners are required to make capital contribution to the firm for its business requirement. On sale of property as detailed above, the assessee has taxed the profit on sale of land under income from long term capital gains after indexation and paid due tax. However, the Assessing Officer treated the profit on sale of land as business income instead of capital gains, which was confirmed by the ld. CIT(A). Against the reliance of CBDT Circular No. 4/2007 dated 15.06.2007, the ld. CIT(A) was of the opinion that the same was issued specifically in the context of investments in securities and cannot be applicable to the facts of the current case. According to the ld. CIT(A), even if one tried to apply the above circular, as relied by the assessee by quoting the decision of ITAT, Pune in the case of Shri Krishna Kumar K. Goyal, Shri Vinit K. Goyal v. ACIT in I.T.A. Nos. 1299 & 1300/PN/2012, the facts appreciated in that case was entirely different from the facts of the current case. In that case, as per the ld. CIT(A), for many years, the land was shown in the balance sheet as 'Personal asset', as a part of investments and other land held as stock-in-trade were separately disclosed in the balance sheet as well as in profit and loss account as 'business assets' and such position was also accepted in the past years even in scrutiny assessment finalized by the Assessing Officer. The ld. CIT(A) also noted the fact that in that case the land was held for a fairly long period of 9 to 10 years before being sold and there was no trading activity. Therefore, the ld. CIT(A) was of the opinion that the CBDT circular as well as case law relied as above, had no application to the facts of the present case. At this juncture, we need to have a look on circular No. 6/2016 dated 29.02.2016, where the CBDT has clarified at (b) of para 3 as under:

Asset side of balance sheets for the year ending 31.03.2011, 31.03.2012 and 31.03.2013 are re-produced hereunder:

Balance sheet for the year ending Assets 31.03.2011 Assets 31.03.2012 Assets 31.03.2013 Lands at Lands at - Investments:

Melpakkam                          Melpakkam
Village:                           Village:
VGN Well Built       2,48,25.604   Cash & Bank                    Raw lands at             4,28,57,044
Properties P. Ltd.                 Balances:                      Melpakkam Village

VGN Enterprises      1,25,83,133   Sundry                 57,84,000   Cash & Bank                      -
Pvt. Ltd.                          Debtors                            Balance
V.N. Devadoss         71,89,125    Cash-in-hand             59,310    Cash-in-hand              59,310
Cash & Bank                        Bank Balance              9,719    Bank Balance              14,703
Balances
Cash-in-hand             29,310                                       Income Tax -               1,090
                                                                      Refund Receivable
Bank Balance              9,719                                       Sundry Debtors
Partners Current                                                      VGN Builders Pvt.         10,133
Account                                                               Ltd.
V.N. Devadoss             3,713                                       V.N. Devadoss          43,18,149
VGN Well Built           12,881                       -
Properties P. Ltd.
VGN Enterprises           6,531                       -
Pvt. Ltd.

5.2     A reading of the above clearly indicates that the assessee had