WHAT IS RURAL AGRICULTURE LAND? so, Agricultural Land in Rural Area in India is not considered a capital asset. Therefore, any gains from its sale are not taxable under the head Capital Gains. ural Agricultural land, it means an agricultural land in Inia — (a) situated in any area which is comprised within the jurisdiction of a municipality and its population is less than 10,000, (of situated outside the local limits of municipality, then situated at a aerially 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 (i) 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 (ii) more than 8 kms, from local mits of municipality and which has @ population of more than 10,00,000, Note ~ municipality, here, means any such body such as. municipality, municipal corporation, notified area committee, town] area committee, town committee, or by any other name Example -1 for first limb local Hint of town > land situated here fs Rural agriland snot chargable to tax. Example -2 for second limb and situated ———> hore ie ural agi. land chargable to tax ‘same way apply logic for 6 km and 8 km rule depend on population of that town/village / city