TMI Blog1981 (4) TMI 138X X X X Extracts X X X X X X X X Extracts X X X X ..... behalf of the State Government and the Food Corporation of India ('the FCI') and derived income from such activity also during the year under appeal. The assessee also derived income from interest, supervision charges, fumigation service charges and miscellaneous items. From perusal of the profit and loss account (see page 21 of the annual report and statement of accounts of the assessee, pertaining to the assessment year 1975-76, included on page 23 of the paper book), it appears that the assessee derived the following incomes during the year under appeal: Rs. 1. Warehousing charges 51,06,433.65 2. Administrative ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the finding of the Commissioner (Appeals) is as follows: "Now, as pointed out, the principal activity and main source of the assessee's income was warehousing. The assessee, in fact, came into existence for carrying on this activity. The staff, etc., employed by the assessee and the other expenses incurred by it were mainly for the purpose of carrying on this activity. The other activities undertaken by the assessee were wholly independent of this activity---they did not form part of this activity and, therefore, in regard to the other activities, they are the assessee's business. At the same time, it is not a case of exemption of interest or dividend. Section 10(29) of the Act allows exemption in respect of income derived from the wareho ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... xemption in respect of the entire income. So, the question for consideration is whether the assessee is entitled to exemption under section 10(29) in respect of the income derived from the State Government/FCI for procurement of grains, interest, supervision charges, fumigation service charges and miscellaneous income. We find substance in the submissions of Shri Ranka that the activity of the assessee is an integrated one and that the entire activity is aimed at facilitating the marketing of all the goods. The assessee owns warehouses where the agricultural produce are stored. For storage of foodgrains, the assessee constructs new warehouses also. Maintenance of the warehouses is also done by the assessee. Procurement of foodgrain was done ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ved from FCI on the procurement of grains is exempt under section 10(29), we do not see any reason why the income received from the State Government for the procurement of grains is not covered by section 10(29). Such income, we think, is fully covered by the expression "facilitating the marketing of commodities", occurring in section 10(29). Relying on the decision dated 8-11-1977 of Allahabad Bench 'B' we hold that the assessee is entitled to exemption in respect of Rs. 11,06,034.33, representing administrative overhead charges. The interest income amounting to Rs. 11,41,350.23, is also fully covered by the decision of the Allahabad Bench 'A' of the Tribunal. The copy of the said order is on pages 1 to 5. This case also pertains to the U. ..... X X X X Extracts X X X X X X X X Extracts X X X X
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