TaxTMI 
TaxTMI 
2013 (12) TMI 1633
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....the Assessing Officer to treat the assessee's income as agricultural income u/s. 2(1A)(b)(ii) of the Income-tax Act, 1961 and to exclude the said income u/s. 10(1) of the Act." 2. The briefly stated facts are as under. The assessee company is in the business of plant floriculture / tissue culture and horticulture which are claimed by the assessee as agricultural activities. The assessee is claiming the income derived from the said activities as agricultural income and claimed the exemption u/s. 10(1) of the Income-tax Act. 3. So far as A.Y. 2009-10 is concerned, the assessee declared the income derived from the said activities to the extent of Rs. 5,75,67,448/- as agricultural income and claimed the exemption u/s. 10(1) of the I.T. Ac....
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....s as under: "7. We find that the Tribunal in the case of assessee for the A.Y. 2004-05 has discussed an identical issue in detail before deciding the same in favour of the assessee. The Tribunal while deciding the issue has taken strength from several decisions including decision of Hon'ble Supreme Court in the case of CIT Vs. Raja Benoy Kumar Sahas Roy (Supra), Hon'ble Madrash High Court in the case of CIT Vs. Soundarya Nursery, 241 ITR 530(Mad.) and of Hon'ble Allahabad High Court in the case of Jugal Kishore Arora Vs. DCIT, 269 ITR 133 (Allhad.). The relevant para Nos. 33 to 40 of the decision of the Tribunal in the case of the assessee for A.Y. 2004-05 (supra) are being reproduced hereunder for a ready reference : "33.....
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....ssessee's activities was the mother plant, which is reared on earth and for which certainly contribution of human labour and energy was essential". These observations equally apply to assessee's case as well. 36. In Soundarya Nursery's case, Hon'ble Madras High Court, after taking note of the law laid down by the Hon'ble Supreme Court in the case of Raja Benoy Kumar Sahas Roy (supra) and the facts of the case, observed as follows: All the products of the land, which have some utility either for consumption or for trade or commerce, if they are based on land, would be agricultural products. Here, it is not the case of the Revenue that without performing the basic operations, only the subsequent operations, as described in t....
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.... involved, the nature of operations would not change. Learned CIT(A) has distinguished this precedent on the ground that in assessee's case, basic operations have not been carried out on land. That premises itself, for the detailed reasons set out earlier in this order, rests on a unsustainable legal foundation. The basic operations have been, and can only be, carried out on the land. The fact that this land is in a greenhouse does not change the character of operations. The distinction was thus wrongly made out by the CIT(A), in our considered view, the principles laid down by the Hon'ble Madras High Court's judgment in the case of Soundaraya Nursery (supra) apply to the facts of the case before us as well. 38. We may also refer t....
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....s invited to several judicial precedents in which it is noted that even while an amendment is stated to be prospective in application, but held to be retrospective in effect. On the basis of these elaborate arguments, it was submitted that, in any event, based on this clarificatory amendment in law, basic operations having been carried out on land is no longer sine qua non for treating income as agricultural income. This plea was clearly an alternative plea. Since we have allowed the basic plea of the assessee and we have held that the basic operations were carried out on land, it is not really necessary to deal with this alternative plea which is only academic in the present content. We leave it at that. 40. In view of the above d....