High Court Of Allahabad
CIT vs. Associated Metals Co.
Asst. Year 1980-81, 1981-82
R.M. Sahai & R.K. Gulati, JJ.
IT Appln. Nos. 125 & 126 of 1988
1st February, 1989
Bhartji Agarwal, for the Revenue
R. M. SAHAI, J. :
In these two applications under s. 256(2) of the IT Act, 1961, for asst. yrs. 1980-81 and 1981-82, the following question of law has been raised :
“Whether, on the facts and in the circumstances of the case, the Tribunal was, in law, justified in holding that the income derived by the assessee-company should be considered as agricultural income ?”
2. It has been found by the Tribunal that the assessee-company entered into an agreement with Bhumidhars of land for not only filling and cleaning the land but also sowing, growing and protecting the crops. And thereafter the major share of the profit was to be of the company. On these facts, the Tribunal held, after taking into account the totality of the circumstances, that the income derived by the company was agricultural income.
3. It has been urged that since the land belonged to Bhumidhars, the income arising out of it would belong to them and not to the assessee. The submission appears to be devoid of any merit in view of the findings recorded by the Tribunal that agricultural income, according to sub-cl. (i)(b) of s. 2 of the IT Act, means any income derived from land used for agricultural purposes. In the result, both the applications fail and are dismissed.
[Citation : 177 ITR 428]