Law: Income-tax Act, 1961

Section: 2(1A)

Section 2(1A) , read with section 10(1) of the Income-tax Act, 1961 [Corresponding to section 2(1)(a), read with section 4(3)(viii) of the Indian Income-tax Act, 1922] - Agricultural income - Whether interest received on arrears of agricultural rents due to assessee from his tenants is agricultural income within meaning of section 2(1)(a) of 1922 Act and, hence, exempt from taxation - Held, yes - Assessee derived income from sale of various forest produces - Assessee also derived income from leases of forest for purpose of cutting and removing standing timber and fuel - Finding regarding nature of forest was that it was not a cultivated one but was of spontaneous growth - Whether income derived from sale of forest produce was not agricultural income and, hence, not exempt from taxation - Held, yes - Whether lac cultivation cannot be regarded as an agricultural operation, hence, income from sale of lac was also liable to tax - Held, yesSection 2(1A) , read with section 10(1) of the Income-tax Act, 1961 [Corresponding to section 2(1)(a), read with section 4(3)(viii) of the Indian Income-tax Act, 1922] - Agricultural income - Assessee claimed that nazrana receipts were exempt from taxation being agricultural income - However, assessee produced no evidence to show that nazrana receipts flew from agricultural sources - Whether burden was on assessee and as he produced no evidence, nazrana receipts were rightly brought to tax - Held, yesFACTSThe question for consideration before the High Court was whether income derived from the sale of forest produce was agricultural income' exempt from tax under section 4(3)(viii).HELDIt was admitted that the land in all question was either assessed to land revenue, or was subject to a local rate assessed and collected by officers of the Crown as such, and that, therefore, to that extent, the income complied with the definition. But that was not enough, for, it must also either be used for agricultural purposes or for agriculture.The essence of agriculture, even when it is extended to include "forestry," is the application of human skill and labour. Without that it can be neither an art nor a science.Central Acts apply all over…

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