9911796707
TMI Blog2020 (12) TMI 825X X X X Extracts X X X X X X X X Extracts X X X X ..... missioner of Income Tax (Appeal has erred in confirming addition of a sum of Rs. 10,14,000/- as income from other sources. The Assessee prays that such an addition be deleted as the same being Agricultural income or a capital receipt . 2. We have carefully heard the rival submissions and perused relevant material on record including the impugned order and documents placed in the paper-book. The judicial precedents as cited during the course of hearing have been deliberated upon. Our adjudication to the subject matter of appeal would be as given in succeeding paragraphs. 3.1 The material facts are that the assessee being resident corporate assessee is stated to be engaged in the business of manufacturing and trading of essential oil, plant ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... sation received in lieu thereof would be capital receipts chargeable to tax. Upon cutting of the tree, the assessee's right there-in stood extinguished. Finally, the income so earned was held to be taxable under the head Income from other sources. 4. Before Ld. CIT(A), it was submitted that the trees grown, nursed and protected by the company since last many years was a capital asset from which regular income was derived from year to year. Cutting of tree permanently was loss of capital asset. However, Ld. CIT(A) rejected various submissions raised by the assessee and held as under: - 3.1.2 This ground of appeal pertains to addition of Rs. 10,14,000/- as income from other sources. During the assessment proceedings, the AO observed that t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... .As per section 2(1A), agricultural income generally means (a) Any rent or revenue derived from land which is situated in India and is used for agricultural purposes. (b) Any income derived from such land by agriculture operations including processing of agricultural produce so as to render it fit for the market or sale of such produce. (c) Any income attributable to a farm house subject to satisfaction of certain conditions specified in this regard in section 2(1A). 3.1.7 I find guidance on this issue in the view taken by Hon'ble Apex Court in the case of V. Venugopala Varma Rajah vs Commissioner Of Income-Tax 1970 AIR 2051, 1970 SCR (2) 547, dated 24.09.1969 wherein the Hon'ble Supreme Court has observed that It is not nec ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nt and Forests, Agarwood trees are capable of regeneration, and Hon'ble Supreme Court in the case of V Venugopala Varma Rajah vs Commissioner Of Income-Tax 1970 (Supra), after analysing every nook and corner details on this issue, has held that if the trees are capable of regeneration, then, income from cutting of the same is to be brought to tax and it is certainly not capital in nature. 3.1.10 In view of the above, I do not find any reason to interfere with the decision of the AO on addition of Rs. 10,14,0007- as income from other sources. This ground of appeal is therefore dismissed. Aggrieved, the assessee is in further appeal before us. 5. Upon due consideration of factual matrix, we find that certain trees lying on assessee's ..... X X X X Extracts X X X X X X X X Extracts X X X X
|
