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TMI Blog2017 (8) TMI 473X X X X Extracts X X X X X X X X Extracts X X X X ..... on u/s.10(1) amounting to Rs. 7.35 crores (rounded off). He also made disallowance on account of depreciation on goodwill. The assessed income was determined at Rs. 8,04,49,290/-. In the return, assessee disclosed exempt agricultural income of Rs. 7,34,69,520/- earned on account of tissue culture products. Assessee invoked the provisions of section 10(1) relating to exempt agricultural income. Further, assessee relied on the order of the Tribunal for Assessment Year 2004-05 in its own case. AO rejected the same and proceeded to deny the said exemption. 4. During the First Appellate proceedings assessee filed written submissions. Assessee relied heavily on the decision of the Tribunal as seen from the contents of Para No.3.6 of his order. Relying on the said order of the Tribunal for the Assessment Years 2004-05 and 2009-10 (ITA No.2217/PN/2012 order dated 24-12-2013) AO was directed to grant relief to the assessee and treat the income derived from floriculture and tissue cultures as agricultural income u/s.10(1) of the Act. 5. Aggrieved with the same the Revenue is in appeal with the above referred issues raised in Ground Nos. 1 to 7. 6. At the outset, Ld. Counsel for the assess ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n ITA Nos. 1274 to 1278/PN/2010 dated 22nd February 2012 is as under: "7. We find that the Tribunal in the case of assessee for the A.Y. 2004-05 has discussed an identical issue in detail before deciding the same in favour of the assessee. The Tribunal while deciding the issue has taken strength from several decisions including decision of Hon'ble Supreme Court in the case of CIT Vs. Raja Benoy Kumar Sahas Roy (Supra), Hon'ble Madrash High Court in the case of CIT Vs. Soundarya Nursery, 241 ITR 530(Mad.) and of Hon'ble Allahabad High Court in the case of Jugal Kishore Arora Vs. DCIT, 269 ITR 133 (Allhad.). The relevant para Nos. 33 to 40 of the decision of the Tribunal in the case of the assessee for A.Y. 2004-05 (supra) are being reproduced hereunder for a ready reference : "33. In our considered view, therefore, the operations carried out on the facts of the case before us are agricultural operations in nature. The objections taken by the authorities below are devoid of any legally sustainable merits/. Applying the ratio of the Hon'ble Supreme Court's judgment in the case of Raja Benoy Kumar Sahas Roy (supra), the income from these operations has to be treated as agricultur ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... dy for sale as plants all these questions would be agricultural operations all this involves human skill and effort. Thus, the plants sold by the assessee in pots were the result of primary as well as subsequent operations comprehended within the term "agriculture" and they are clearly the products of agriculture. 37. When we apply the above tests to the facts of the present case, and we bear in mind our findings that basic operations are carried out in the present case, which require human skill and labour, and subsequent operations, no matter how sophisticated, if that be used against the assessee, are only to foster the growth and to protect the produce, we find that the income from these operations can only be said to be agricultural income. Their Lordships were also dealing with a situation in which operations were carried on in a greenhouse. Therefore, merely because a greenhouse in involved, the nature of operations would not change. Learned CIT(A) has distinguished this precedent on the ground that in assessee's case, basic operations have not been carried out on land. That premises itself, for the detailed reasons set out earlier in this order, rests on a unsustainable ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e we have allowed the basic plea of the assessee and we have held that the basic operations were carried out on land, it is not really necessary to deal with this alternative plea which is only academic in the present content. We leave it at that. 40. In view of the above discussions, and for the reasons set out above, we are of the considered view that the authorities belong indeed erred in law and on facts of this case in holding that the impugned income is not agricultural income. We, therefore, direct the Assessing Officer to treat the said income as agricultural income under section 2 (1A)(b)(i) of the Act. As a corollary to this direction, the Assessing Officer shall also exclude the said income from the total income under section 10(1) of the Act. The assessee gets the relief accordingly." Since the issue raised is fully covered by the decision of Pune Bench of the Tribunal in the case of assessee itself for the A.Y. 2004-2005, under similar set of facts, we do not find infirmity in the first appellate order on the issue in favour of the assessee based on the said order of the Tribunal under similar facts during the assessment year under consideration. The same is upheld. ..... X X X X Extracts X X X X X X X X Extracts X X X X
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