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2023 (7) TMI 277 - ITAT HYDERABADAgricultural income or Income from other sources - sale of timber of the trees that were grown on the border of his land - AO did not agree with the contention of the assessee on the ground that the land of the assessee is situated in urban area; assessee is, therefore, an urban land holder and accordingly there cannot be any agricultural income nor any exemption u/s 10(1) - HELD THAT:- When once the assessee produced the commercial crops like chilies and cotton, it is too much to expect that all the chilies and cotton grown on 11 acres of land would be kept by the assessee for his own consumption or that he has given all such produce for charity, without deriving any income what-so-ever. Assessee is an agriculturist, eking out livelihood from agricultural operations, which would be culminated by realization of the amount by sale of the harvested agricultural produce. Agriculturists are not regular business men, who would keep the books of accounts or the vouchers and bills on a professional basis. ITO clearly observed that when he visited land, he found around 30 stems of the cut trees and remaining stems he could not observe for the reasons that since three years elapsed, due to irrigation for growing the further crops same stems must have buried, or being covered by bushes and forest trees which he found actually existing on the spot. This fact establishes that there were trees and those were cut. Assessee produced the tree cutting permission issued by the Tahsildar, Khammam, which shows that there were 120 teak wood trees and 21 bamboo trees planted about 15 years back in the land of assessee and the assessee sought the permission to cut and to sell the same. There is no reason to suspect the sale of wood, because the assessee obtained permission from the Tahsildar and the ITO observed that there was evidence of cutting of trees. The assessee satisfactorily explained the agricultural income of Rs. 4 lakhs and no addition is warranted - Decided in favour of assessee.
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