TMI Blog1993 (1) TMI 44X X X X Extracts X X X X X X X X Extracts X X X X ..... uthority found on an interpretation of the agreement that the agreement would take in the right to slaughter-tap the rubber trees included under the agreement. On that basis, a portion of the sale consideration was taken as agricultural income and that assessment was challenged before the appellate authority. The Appellate Assistant Commissioner confirmed the assessment and dismissed the appeal. The petitioner filed an appeal before the Agricultural Income-tax Appellate Tribunal. The Tribunal also, after considering the various aspects of the matter, confirmed the order of the Appellate Assistant Commissioner as regards the interpretation of the agreement, but modified the order in regard to interest and bank charges and also in regard to e ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the dealings as contained in the agreements indicated that part of the consideration was towards latex and hence that part represented agricultural income. The assessing authority was, therefore, right on facts in treating that part of the consideration as agricultural income. Counsel for the petitioner submitted that the authorities concerned did not properly construe the agreements and, on a proper construction of the agreements, it is possible to say that the agreements for sale were exclusively for the timber of the uneconomic trees and no element of taking latex from the trees was involved in the agreements for sale. The question of interpretation of an agreement can also be treated in certain cases as a question of law. Nevertheless, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... to the value of trees. (v) The part pertaining to latex is agricultural income, liable to tax, and the other part which is attributable to the value of the trees is not liable to tax." This decision was relied on by the Division Bench in Thirumbadi Rubber Co. Ltd. v. Commr. of Agrl. L T. [1977] 110 ITR 639 (Ker). From the above decisions, it has to be noted that we have to interpret the agreement to see whether there is any permission given to the purchaser of the trees by the owner for slaughter-tapping. In short, what we have to consider while construing the agreement is the intention of the parties. The intention of the parties has to be ascertained from the terms of the agreement. The agreements are produced in this case. Annexure ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ent, we are of the view that the parties intended to have an agreement for sale of the rubber trees giving and obtaining permission for slaughter-tapping of the trees sold. In this view, the findings recorded by the Tribunal and the other authorities are valid and in consonance with the terms of the agreement. Counsel submitted that we must follow the decision reported in Commr. of Agrl. L T. v. Pullangode Rubber and Produce Co. [1979] 120 ITR 84 (Ker). The terms of the agreement considered in that case are totally different from the terms of the agreements involved in this case. In Commr. Agrl. L T. v. Pullangode Rubber and Produce Co. [1979] 120 ITR 84, the Division Bench was construing an agreement for sale of uneconomic rubber trees. ..... X X X X Extracts X X X X X X X X Extracts X X X X
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