Exemption u/s 10(27) - dairy farming - Income Tax - 495 / CBDT

INSTRUCTION NO. 495 / CBDT Dated : January 11, 1973 Section(s) Referred: 10(27) Statute: Income - Tax Act, 1961 Reference is invited to the Board's circular letter F.No. 4/3/68-IT(AI) dated the 6th March, 1968, on the above. 2. The Board's view as communicated in the above letter was that even when the cattle are stall-fed, the benefit of S.10(27) will be available provided the cattle are owned by the assessee. Recently the Board had occasion to consider a case where the assessee did not own any cattle but was maintaining a farm, wherein fodder suitable for quality milk was grown and cowsheds and veterinary services were also provided. The Tribunal held that the activity constituted dairy farming within the meaning of S.10(27). 3. Whereas the mere buying and selling of milk will not constitute dairy farming , the Board is advised that so long as the principal business is the production of milk, it does not matter whether the cattle are owned by the assessee or not. The view expressed in the earlier letter is modified to that extent. All the officers may be advised accordingly.