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1993 (6) TMI 44 - HC - Income Tax

Issues:
Assessment of income from sale of rubber trees and slaughter-tapping under the Agricultural Income-tax Act for the assessment year 1979-80.

Analysis:
The petitioner, a limited company engaged in rubber planting, sold uneconomic rubber trees to third parties and received a sum of Rs. 1,86,395 during the relevant period. The assessing authority considered two-thirds of this amount as income from slaughter-tapping, included it in agricultural income, and assessed tax under the Agricultural Income-tax Act. The Deputy Commissioner (Appeals) and the Agricultural Income-tax Appellate Tribunal upheld this assessment. The Appellate Tribunal based its decision on clause 5 of the agreement, which it interpreted as indicating that the consideration received was for slaughter-tapping as well as cutting and removal of trees. The Tribunal accused the assessee of not providing evidence to show that no slaughter-tapping had occurred. However, the High Court found the Tribunal's interpretation of clause 5 to be erroneous and unsupported. The Court held that there was no basis to conclude that the consideration was for slaughter-tapping, and the burden of proof lay with the Revenue to establish the occurrence of slaughter-tapping. The Court criticized the Tribunal for its faulty reasoning and conjectural findings, ultimately setting aside the Tribunal's order that treated a portion of the amount received as income from slaughter-tapping. The Court ruled that there was no evidence to support the inclusion of any amount for slaughter-tapping, and directed the Tribunal and assessing authority to comply with its decision.

In conclusion, the High Court allowed the revision, setting aside the Tribunal's order regarding the treatment of the consideration received as income from slaughter-tapping. The Court emphasized that the burden of proof rested with the Revenue to establish the occurrence of slaughter-tapping, and criticized the Tribunal for its faulty reasoning and lack of evidence to support its findings. The Court directed the Tribunal and assessing authority to implement its decision, with no costs awarded in the matter.

 

 

 

 

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