TaxTMI 
TaxTMI 
1984 (6) TMI 100
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....arh, surrounded by a fruit garden beside the lawns in front, back and sides. The property in question was rented out to the Indian Explosives Limited at a total monthly rent of Rs. 2,000 per month with rental bifurcation in respect of different parts of the property, as under: Rs. "(a) Rent for accommodation on GF ....
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....nt quarters at the rate of Rs. 150 per month each 300 per month (g) Fixed price of fruits of all the fruit trees (except one Mango Langra plant and one Alichi plant near the servant quarters) at 200 per month the rate of Rs. 2,400 &....
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....of Rs. 2,400 having held the same as non-agricultural income. 3. When this dispute came before the AAC, she in the end of paragraph 3 of her order making the following observation, confirmed the action of the ITO : "... This income cannot be categorised as agricultural income within the meaning of section 2 of the Income-tax Act. This income is part and parcel of rental income." 4. While disputing this finding of the AAC, the learned counsel for the assessee S.S. Rikhy submitted that three requirements, stipulated as per definition of 'agricultural income' are there, viz., (i) rent or revenue derived from, (ii) land which is situated in India, and (iii) is used for agricultural purposes. He submitted that from the deed of tenancy, ....
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....ter taking into consideration the rival submission and going through the facts available on record, we find the following uncontroverted facts: (i) House No. 28, Sector 9-A, belonged to the assessee and the same being surrounded by a garden comprising of ground floor, first floor, garage, servant quarters, fixtures and fittings, etc., was rented out for a total sum of Rs. 2,000 per month. (ii) As per bifurcation available in the tenancy note, Rs. 2,400 was to be paid per annum to the assessee as fixed price of fruits of all the fruit trees except one Mango Langra and one Alichi plant near the servant quarters. The ITO, however, challenged in the assessment order, as per his observations, extracted and placed above, that no evidence wa....
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.... not be categorised within the meaning of section 2. 7. Reliance of the learned departmental representative on all the case law, is misplaced. On the other hand, some of those cases support the contention that of the assessee. The first case of Raja Mustafa Ali Khan, which was relied upon by the learned departmental representative was in respect of malikana payments and in that case the forest trees were growing on the land naturally and without the intervention of human agency. If the case in question is carefully read, distinction would be apparent that in the instant case it was not a question of spontaneous growth but of plants which were grown being fruit trees. Similarly, the case of Maharaja Pratap Singh Bahadur again pertains to ....
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.... not agricultural income within the meaning of section 2(1)(a) of the Indian Income-tax Act, 1922. Maharajakumar Gopal Saran Narain Singh v. CIT [1935] 3 ITR 237 (PC), CIT v. Raja Bahadur Kamakhaya Narayan Singh [1948] 16 ITR 325 (PC), Bacha F. Guzdar v. CIT [1955] 27 ITR 1 (SC) and Maharajadhiraja Sir Kameshwar Singh v. CIT [1961] 41 ITR 169 (SC) applied. (iii) that the amount received by the respondent was revenue income and was, therefore, taxable. Where an owner of an estate exchanges a capital asset for a perpetual annuity, it is ordinarily taxable income in his hands. The position will be different, if he exchanges his estate for a capital sum payable in instalments : the instalments when received would not be taxable income." C....