TMI Blog1989 (9) TMI 91X X X X Extracts X X X X X X X X Extracts X X X X ..... ces of the case, the payment made by the assessee to Messrs. Bullard and Co. of U. S. A. in pursuance of an agreement dated January 30, 1960, between them was expenditure capital in nature and not revenue expenditure ? (3) Whether, on the facts and in the circumstances of the case, the Tribunal was right in holding that sugarcane crushers are agricultural implements within the meaning of item No. 9, Schedule V, and that profits arising from the manufacture of sugarcane crushers would be entitled to relief under section 80E of the Income-tax Act, 1961 ? (4) Whether, on the facts and in the circumstances of the case, the Tribunal was right in holding that sugarcane crushers are agricultural implements within the meaning of item No. 9, Sch ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... turists for the purpose of conversion of the sugarcane into sugar juice, being the first step in the process of conversion of sugarcane into jaggery. The question at issue is, therefore, whether the process of conversion of the sugarcane into jaggery employed by the agriculturists or sugarcane growers is a part of the agricultural process employed by the agriculturists to enable them to make their produce marketable. This will depend upon whether or not an agriculturist is in position to sell the sugarcane produced by him in that form itself without its conversion into jaggery. There can be no doubt that the only market for the sugarcane to be sold in that form would be the sugar factories. If, in spite of there being demand by the sugar fa ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ng its sugar content within 48 hours of being cut. There was a sugar mill near the lands belonging to the assessee which bought sugarcane in its natural condition, but the evidence showed that the mill bought sugarcane mainly from cultivators in the factory area and from Government farms and had refused in the past to buy from the assessee. The Tribunal concluded that the existence of the single mill would not constitute a market for the assessee's sugarcane in its natural condition. Conversion of sugarcane into jaggery was a process ordinarily employed in India to render it fit to be sold in the market. This court noted that findings of fact made by the Tribunal were open to attack in a reference only if they were perverse or were reached ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of the Supreme Court in Dooars Tea Co. Ltd. v. Commr. of Agri. I. T. [1962] 44 ITR 6. The assessee held a large tract of land upon which it grew bamboos, thatching grass and fuel timber by agricultural operations. These were not sold but were utilised by the assessee in its tea business. The question was whether they constituted agricultural income, and the court held that they did. It is difficult to see how the decision in Dooars Tea Co. Ltd. [1962] 44 ITR 6 (SC), can advance the case of the Revenue. It is very difficult to hold that an agricultural activity ends the moment that agricultural produce is grown or that it does not take into, account any process which is requisite to preserve it and/or make it marketable. In our view, an a ..... X X X X Extracts X X X X X X X X Extracts X X X X
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