TMI Blog2019 (7) TMI 82X X X X Extracts X X X X X X X X Extracts X X X X ..... come assessable in the hands of assessee The CIT(A) while deciding the issue in the present case had in turn, relied on the decision of ACIT Vs. Ajeet Seeds Ltd. [ 2013 (11) TMI 894 - ITAT PUNE] which has been confirmed by Bombay High Court [ 2015 (6) TMI 1187 - BOMBAY HIGH COURT] . Consequently, we hold that growing of hybrid seeds in the case of assessee can never be held to be non-agricultural activity. Hence, the assessee is entitled to claim deduction under section 10(1) of the Act. - Decided in favour of assessee. - ITA No.2754/PUN/2016 And 793/PUN/2017 Assessment Year : 2012-13, 2013-14 - - - Dated:- 27-6-2019 - Ms. Sushma Chowla And Shri Anil Chaturvedi, JJ. Appellant by: Shri Pankaj Garg Responden ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... orrectly apply the ratio of the decision of the Hon'ble Supreme Court in the case of CIT vs Raja Benoy Kumar Sahas Roy, 32 ITR 466, wherein carrying on of basic operations by expanding human skill and labour on land had been held as an essential prerequisite of agriculture and, as per the said ratio the assessee's activity would not amount to agriculture at all. (v) The Ld. CIT(A) grossly erred in failing to appreciate that the green house itself does not constitute land/earth and in holding that Explanation 3 of section 2(1A) would apply irrespective of whether the basic operations have been carried out on land or not which is not only extraneous to the said explanation but also does not flow there from. (vi) Fo ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ceipts as per Profit and Loss Account were ₹ 5.54 crores and after considering various expenses, there was loss of ₹ 1.22 crores. The books of account were audited by an auditor but the assessee had shown the entire receipts of ₹ 5.54 crores as agricultural income, which was claimed as exempt. The CIT(A) observed that the assessee itself was responsible for creating the mess as it had declared total receipts as agricultural income. The CIT(A) further notes that the Assessing Officer also failed to appreciate the facts of case and had taxed the entire receipts of ₹ 5.54 crores even though there was loss of ₹ 1.22 crores, as per Profit and Loss Account, which was noted by Assessing Officer in para 4 of assessment ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... irly pointed out that entire receipts of ₹ 5.54 crores was assessed as income of assessee though CIT(A) at page 7 notes the fact that there was loss in the said activity carried on by assessee. 10. The learned Authorized Representative for the assessee on the other hand, pointed out that the issue now stands covered by the judgment of jurisdictional High Court at Aurangabad Bench, wherein the order of Tribunal in CIT Vs. Ajeet Seeds Ltd. (supra) has been upheld. The learned Authorized Representative for the assessee also placed reliance on the decision of Pune Bench of Tribunal in bunch of appeals with lead order in ITA No.642/PUN/2015, relating to assessment year 2011-12, order dated 02.11.2018, which had also decided simil ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... assessability of income arising from the activity carried on by assessee of growing hybrid seeds and whether the same is agricultural activity. We find that the issue now stands squarely covered by the order of Aurangabad Bench of Hon ble Bombay High Court in CIT Vs. Ajeet Seeds Ltd. in Income Tax Appeal Nos.20 to 26 of 2014, judgment dated 18.06.2015, wherein it was noted that assessee s income arose from sale of breeder and foundation seeds. The Hon ble High Court vide para 4 observed that when breeder seeds and foundation seeds are grown successfully, lot of scientific help was required and it was only after such skilful and scientific process, such seeds were grown. The question which was before the Hon ble High Court was whether growin ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... etic one. Thus, growing seeds can never be non-agricultural. In view of this, we do not see any substantial question of law in these appeals. 13. The CIT(A) while deciding the issue in the present case had in turn, relied on the decision of Pune Bench of Tribunal in ACIT Vs. Ajeet Seeds Ltd. (supra), which has been confirmed by the Hon ble High Court. Consequently, we hold that growing of hybrid seeds in the case of assessee can never be held to be non-agricultural activity. Hence, the assessee is entitled to claim deduction under section 10(1) of the Act. 14. Similar is the proposition in respect of growing of foundation seeds, which is also adjudicated by the Hon ble Bombay High Court. 15. Following the rati ..... X X X X Extracts X X X X X X X X Extracts X X X X
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