TMI Blog2015 (11) TMI 586X X X X Extracts X X X X X X X X Extracts X X X X ..... ltural income and exempt u/s.10(1) - CIT(A) allowed claim - Held that:- The decision taken by the CIT(Appeals) treating the income from nursery as agriculture income is justified and as in similar circumstances, in the case of CIT v. Soundarya Nursery (1998 (8) TMI 37 - MADRAS High Court)as held that the income from the sale of plants grown in pots and the sale of seeds derived on account of cultivation by the assessee was agricultural income. The facts of the present case are similar to that of the Jurisdictional High Court, we have no hesitation in following the same. Further, it is noticed that the Ahmedabad Bench of the Tribunal, in the case of CIT v. Best Roses Biotech (P) Ltd. [2011 (11) TMI 373 - ITAT AHMEDABAD], held that the income ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the AY 2007-08 on 24.10.2007 declaring a total income of ₹ 3,47,238/- and agricultural income of ₹ 51,89,480/-. The assessment was completed u/s.143(3) of the Act on 11.12.2009 on the assessed income of ₹ 10,47,616/- and agricultural income of ₹ 51,89,480/-. The case was reopened by issue of notice u/s.148 dated 23.9.2011. After hearing the assessee, the assessment was completed u/s.143(3) r.w.s.147 on 22.3.2013 determining taxable income at ₹ 62,37,096/- after making disallowance of agricultural income claimed of ₹ 51,89,480/- from nursery. The assessee went in appeal before the CIT(Appeals) challenging the reopening as well the additions made by the Assessing Officer. 4. The CIT(Appeals) confirmed th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... wer Products Ltd v. DCIT (197 taxman 415) (2011) has held that merely because the material lies embedded in the material evidence which the AO could have uncovered but did not uncover, is not a good reason for striking down reopening. (vi) High Court of Mumbai in the case of Export Credit Guarantee Corporation of India Ltd v. Addl. CIT (30 taxman.com 211) (2013) has held that there is no failure on the part of assessee to disclose material facts but there is complete failure on the part of the AO to apply his mind during original assessment to points on which assessment is reopened, reopening was treated as valid. (vii) Above all, it is the prerogative of the AO/Revenue to reopen the assessment if the AO has found in the course ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... der Law - ITO granting deduction under section 80G on account of donation to Charitable Trust overlooking fact that recognition granted to charitable trust had expired - Reopening was on basis of factual information given by Internal Audit Party - Reopening of assessment valid - Income-tax Act, 1961, s. 147(b). In view of the above, we agree with the findings of the lower authorities on this issue and reject the issue raised by the assessee in the cross objection. 6. As far as the issue of disallowance of agricultural income is concerned, in Revenue s appeal, assessee claimed agricultural income of ₹ 51,89,480/- but the same was treated as business income by the AO. The assessee, a landscaping architect was running two busine ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... provisions treated the income derived from nursery as agriculture income which are applicable from AY. 09-10. As per the decision in the case of CIT v. Green Gold Tree Farmers P Ltd (2008) 167 Taxman 151, (Uttarakand), relied on by the Id.AR, sale proceeds of plants raised in nursery on land belonging to the assessee constitute agriculture income. This judgment was delivered on 28.2.2007. In view of the above decision, the CIT(Appeals) held that the income from nursery raised on the land owned by the assessee will be treated as agriculture income and he considered the moot question, whether these legal provisions are applicable in assessee s case which pertains to A. Y. 07 -08. 7.2 The CIT(Appeals) observed that similar decisions includi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n of agriculture income prior to insertion of this explanation did not include nursery as agricultural activity at all. The explanation is not an amendment to the main provisions of the definition of agriculture income. It is only a clarification of what agriculture income means. Therefore, the CIT(Appeals) held that the definition of agriculture income prior to insertion of Explanation-3 would include the activity of nursery also and directed the AO to allow exemption u/s.10(1) of the Act. Aggrieved by this order, the Revenue is in appeal before us and the cross objection filed by the assessee is in support of deletion of addition by the CIT(Appeals). 8. We have heard both the parties and perused the material on record. In our opinion, ..... X X X X Extracts X X X X X X X X Extracts X X X X
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