TaxTMI 
TaxTMI 
1972 (10) TMI 25
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....ural Income-tax Officer disallowed the following three items of expenses incurred by the assessee :- (1) a sum of Rs. 8,063 said to have been incurred in connection with the cardamom cultivation ; (2) a sum of Rs. 3,416.87 said to be the interest paid to the workers on their savings deposits ; and (3) a sum of Rs. 2,056.39 incurred for the annual sports and other social gatherings of the labourers. Aggrieved against the disallowance of those items, the assessee went in appeal to the Assistant Commissioner of Agricultural Income-tax but without success. The assessee, therefore, filed a further appeal before the Tribunal. The Tribunal also substantially agreed with the view taken by the Agricultural Income-tax Officer, though it allowed a ....
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....come arising from tea plantations is limited to legislating with respect to the agricultural income determined in accordance with rule 24 of the Indian Income-tax Rules, 1922, under which income derived from the sale of tea grown and manufactured by the seller is first to be computed under section 10 of the Indian Income-tax Act, 1922, as if it were income derived from business, and of the income so computed, 60% alone will be taken to be agricultural income, that the State legislature cannot enact such a provision which would make agricultural income from tea plantations higher than what it would be if computed in accordance with rule 24 read with section 10 of the Indian Income-tax Act, and that the provisions of the Indian Income-tax Act....
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....Court stated in State of Tamil Nadu v. Kannan Devan Hills Produce Co. Ltd. : " It is noteworthy that even in the first proviso to rule 7 the Agricultural Income-tax Officer has been enjoined to ordinarily accept the computation made by the Central Income-tax Officer. " In a recent decision of this court in Commissioner of Agricultural Income-tax v. Periakaramalai Tea & Produce Co. Ltd. Veeraswami C. J., speaking for the Bench, while considering the question as to whether the deduction in respect of the profits from the industry contemplated under section 80-I of the Income-tax Act, 1961, should be applied to the profits and gains attributable to the income from the tea industry before rule 8 of the Income-tax Rules, 1962, is applied t....
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.... Income-tax Officer, in order to ascertain 60 per cent. of the income for the purpose of levy under the Agricultural Income-tax Act, should have to deduct 8 per cent. under section 80-I in order to ascertain the true income. " Relying on the above decisions, the learned counsel for the assessee contends that the authorities below acting under the Agricultural Income-tax Act cannot modify the computation of agricultural income made by the Central Income-tax Officer by disallowing some of the items of expenses which have been actually allowed by the Income-tax Officer while determining the income from tea, and that if such modification is permitted, it would mean that they can compute agricultural income at a figure higher than the amount ....
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....om and tea and allowed the proportionate share of expenditure of Rs. 8,369 in addition to what has been allowed by the Agricultural Income-tax Officer in determining the income from cardamom cultivation in his provisional assessment. In his final assessment order, the Agricultural Income-tax Officer has not accepted the apportionment made by the Income-tax Officer of the head office expenses on the basis of acreage, on the ground that the cardamom cultivation has been practically given up. Even if the view taken by the Agricultural Income-tax Officer in this regard were to be taken as correct, that would mean that the said expenditure of Rs. 8,369 disallowed by him should be taken to be the expenditure incurred in relation to the cultivatio....