TMI Blog1973 (7) TMI 30X X X X Extracts X X X X X X X X Extracts X X X X ..... atter arises under the Agricultural Income-tax Act, 1955 (hereinafter called "the Act"). The assessee is a company manufacturing cement. A portion of the lands owned by the company was used for raising elephant grass by utilising the sewage surplus water. The grass so grown was used to feed the cattle of the dairy firm maintained by the company. For the assessment year 1966-67 its agricultural income from the land used for raising elephant grass was estimated at Rs. 4,047. The assessment for that year along with the assessment for the earlier years was challenged before the Appellate Assistant Commissioner but without success. On a further appeal, the Agricultural Income-tax Appellate Tribunal has upheld the order of assessment in relation ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d acres of cultivable land. It is true that during the year of assessment, the cultivation of elephant grass was restricted to 8.04 acres but, for the application of section 10 of the Act as it stood during the assessment year, the extent actually cultivated may not be material but the extent of the agricultural lands held by the assessee will be material. It is not in dispute that in the earlier years the assessee has cultivated elephant grass in more than 12 1/2 standard acres. Therefore, the assessee has held lands more than the exempted limit referred to in section 10 of the Act during the assessment year. The fact that the assessee chose to cultivate only in a portion of the agricultural lands held by it will not make it any the less a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ed to be agricultural land as per the definition in section 2(nnn), the assessee's income from that land cannot be brought to charge as agricultural income. Section 2(nnn) excludes house sites and lands used exclusively for pasture from the definition of " agricultural land ". As per the definition in section 2(nnn) land exclusively used for pasture and the income therefrom cannot be taken to be governed by the provisions of the Act. But the question here is whether the 8.04 acres of land wherein elephant grass have been cultivated by the assessee can be taken to be land used exclusively for pasture. According to the learned counsel for the assessee, if lands in which fodder crops are raised for feeding cattle, then such lands should be dee ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ant grass grown has been used only for the cattle maintained in the assessee's dairy firm and, therefore, no income has been actually received by the assessee. But the fact that the assessee has derived income from the land by raising the elephant grass is sufficient to make it liable under the Act and liability to tax does not depend on the marketability of the goods. Therefore, crops have to be valued in any method known to law. The mere fact that there is no specific market at Dalmiapuram where the elephant grass has been grown does not mean that the crop has no value at all. It is difficult for us to accept the contention of the learned counsel that the value of the grass can only be taken to be actual expenditure incurred by the assess ..... X X X X Extracts X X X X X X X X Extracts X X X X
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