Prawn culture income is not agricultural income where cultivation depends on water rather than land-based agriculture.

Income from prawn culture was held not to fall within agricultural income under section 2(1A) because the statutory definition requires rent or revenue derived from land used for agricultural purposes. The Tribunal treated the Income-tax Act as a self-contained code and confined the inquiry to that definition, holding that authorities on agricultural produce or other agricultural-tax questions were not controlling. It found that prawns are not produce of the land and that their cultivation depends on water rather than agriculture, following the binding Madras High Court view on fishery income. The income was therefore not exempt from tax.

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Issues: Whether income from prawn culture, claimed to be derived from agricultural operations on land, constituted agricultural income within section 2(1A) and was therefore exempt from tax.

Analysis: Agricultural income under section 2(1A) requires rent or revenue derived from land situated in India and used for agricultural purposes. The Tribunal treated the Income-tax Act as a self-contained code and examined only the statutory definition. It held that authorities concerning agricultural produce or unrelated agricultural-tax issues did not govern the question. Relying on the view that income from fisheries is not income from land used for agricultural purposes, the Tribunal noted that prawns are not produce of the land and their cultivation depends on water, not agriculture. The earlier Madras High Court view on fishery income was treated as binding on the Bench.

Conclusion: Income from prawn culture was not agricultural income and was not exempt from tax.

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