TaxTMI 
TaxTMI 
2022 (12) TMI 285
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....of the Hon'ble Principal Commissioner of Income Tax, Hyderabad-2 is erroneous both on facts and in law. 2. The Hon'ble Pr. Commissioner of Income Tax erred in holding that there is any error in the assessment order passed u/s 143(3) dated 19.12.2017 for the assessment year under consideration; 3. The Hon'ble Pr.Commissioner of Income Tax ought to have considered the fact that the Assessing Officer examined the agricultural income admitted of Rs.57,16,613/- and accepted the same as exempted income. 4. The Hon'ble Pr. Commissioner of Income Tax erred in holding that the income derived from banana saplings does not represent agricultural income; 5. The Hon'ble Pr.Commissioner of Income Ta....
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....57,16,613/-. The case was selected for scrutiny under CASS to verify the agricultural income claimed by the assessee. Thereafter, notice u/s 143(2) of the Act was issued on 19.09.2016 and served on the assessee. Assessee had furnished the information as called for. After verification of the information, income returned by the assessee was accepted. 4. The ld.PCIT on perusal of record noted that as the assessee kept the purchased plants in the laboratory for further growth under special conditions using chemicals, controlled temperature etc. and thereafter, sold them to the farmers. As such, the income derived from the above activity does not fall under the definition of 'agricultural income' as defined u/s 2(1A) of the Act for which exem....
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....no enquiry was made by the Assessing Officer and even no question was asked by the Assessing Officer for the purpose of finding of the reasons for allowing the activities of the assessee to arrive to a conclusion that the activities of the assessee are agricultural activities or not. Ld. DR had also produced the copy of note sheet of the Assessing Officer and also submitted that there is no issuance of questionnaire by the Assessing Officer to the assessee. 8. In rebuttal, the ld. AR had submitted that the action on the part of the ld.PCIT is incorrect as the activities of the assessee had been examined and further the assessee was into developing of sapling for getting high yield of banana plants. The following submissions were filed by....
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.... information on the activities of the appellant clearly indicate that the soil is the basis for the growth of the banana saplings/banana trees. As is clear by now, the process of agriculture is the cultivation of the land and growing of plants etc., with human skill and effort. The assessee submits that the land would mean prepared soil. The words "soil" and "land" are defined by the Black's Law Dictionary. The definition of the word 'Land' : In the most general sense, "comprehends anu ground, soil, or earth whatsoever; asmeadows, pastures, woods, moors, waters, marshes, furies and heath.Co.Litt 4a. 'The word "land" included not only the soil but everything attached to it, whether attached....
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....see in pots were the result of the basic operations on the land on expending human skill and labour thereon and it was only after the performance of the basic operations on the land, the resultant product grown on such part thereof as was suitable for being nurtured in a pot, was separated and placed in a pot and nurtured with water and by placing them in the greenhouse or in shade and after performing several operations, such as weeding, watering, manuring etc. they were made ready for sale as plans all these operations would be agricultural operations and all this involves human skill and effort. Thus, the plants sold by the assessee in pots were the result of primary as well as subsequent operations comprehended within the term 'agri....
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....In the present case, the case was selected for scrutiny to verify whether the income claimed by the assessee was agricultural income or not. In the present case, no question was asked by the Assessing Officer during the scrutiny assessment to verify whether the income disclosed by the assessee to an extent of Rs.57,16,613/- was an agricultural income. Nothing has been done by the Assessing Officer and the Assessing Officer without making any enquiry had allowed the claim of the assessee treating the same as agricultural income. In our view, the Explanation 2 to section 263 make it abundantly clear that the order passed by the Assessing Officer would be erroneous and prejudicial to the interest of revenue, when no enquiry has been made by th....