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of <h1>Partner's Agricultural Concern Salary Taxable as Remuneration, Not Exempt</h1> <h3>E.C. Danby Versus Commissioner of Income-Tax, Bihar and Orissa</h3> The Tribunal held that the sum paid as salary to a partner for managing an agricultural concern was not exempt from taxation under Section 4(3)(viii) of ... - Issues:- Whether the sum paid as salary to the applicant for supervising an agricultural concern is exempt from taxation under Section 4(3)(viii) of the Income-tax Act.Analysis:The case involved a partnership concern where one partner received remuneration for managing an agricultural property owned by the partnership. The question was whether this remuneration could be taxed as salary or considered as extra agricultural profit exempt from income tax. The Tribunal found that the payment was remuneration for extra work done by the partner and not disputed by the assessee. The Tribunal relied on a previous case to support its decision that such income is taxable under the Income-tax Act. The judgment referenced a case where a similar scenario was considered taxable as salary even though the property managed was agricultural. The judgment emphasized that the ultimate source being agricultural property does not make it agricultural income if the payment is for work done as a manager. The judgment also cited a Privy Council case where fixed monthly remuneration received for managing an agricultural estate was held taxable. The judgment concluded that the sum in question was not exempt from taxation under the Income-tax Act.The judges highlighted the importance of a clear and full statement of facts in the order of reference to save time and ensure proper consideration of the case. The judgment concluded with the decision that the sum involved was not exempt from taxation and directed the assessee to pay costs to the Income-tax Department. The judges reiterated their decision from a similar case and clarified the correct sum involved in the present case. The reference was answered in the negative, confirming the taxability of the sum paid as salary to the partner for managing the agricultural concern.
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