liable to income tax or not, Income Tax

[Dalia Felix]

Suppose a company engaged in farming are exporting their produces after grading, sorting, preserving and packing - will the income be subjected to Income Tax or is exempted as agricultural income.

Posts / Replies

[Naveed S]

Sir,

Tthe definition of agricultural income also includes -- Any income accruing to the person by the performance of any process to render the produce marketable.

Therefore if, in the ordinary course, a process is to be employed by the cultivator himself or the landlord who receives the produce as rent-in-kind, any income derived from such a process shall be agricultural income.

Hence, the process carried out in your case is also covered under definition of agricultural income, however as the process has been carried out a Company and not by the Cultivator/Landlord (as discussed in above para), therefore such activity shall not fall under agricultural income.

However, the views of various experts on the topic may also please be solicited.

[Naveed S]

Sir,

Please refer to you Personal messages on the issue.

Agricultural income is considered for rate purpose while computing tax of Individual/ HUF/AOP/ BOI/Artificial Judicial Person.