Case Law Details
Asst. CIT Vs. KF Bio plant Pvt. Ltd. (ITAT Pune)
The issue in the present case is whether the income derived from the business of plant floriculture / tissue culture is exempt under section 10(1) of the Act.
All the products of the land, which have some utility either for consumption or for trade or commerce, if they are based on land, would be agricultural products. Here, it is not the case of the Revenue that without performing the basic operations, only the subsequent operations, as described in the decision of the apex court have been performed by the assessee. If the plants sold by the assessee in pots were the result of the basic operations on the land on expending human skill and labour thereon and it is only after the performance of the basic operations on the land, the resultant product grown or such part thereof as was suitable for being nurtured in a pot, was separated and placed in a pot and nurtured with water and by placing them in the green house or in shade and after performing several operations, such as weeding, watering, manuring, etc., they are made ready for sale as plants all these questions would be agricultural operations all this involves human skill and effort. Thus, the plants sold by the assessee in pots were the result of primary as well as subsequent operations comprehended within the term “agriculture” and they are clearly the products of agriculture.
Basic operations were carried out on land in greenhouse, which require human skill and labour, and subsequent operations, no matter how sophisticated, were only to foster the growth and to protect the produce, therefore, income from these operations can only be said to be agricultural income. Therefore, merely because a greenhouse was involved, the nature of operations would not change.
Full Text of the ITAT Order is as follows:-
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