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TMI Blog1983 (4) TMI 91X X X X Extracts X X X X X X X X Extracts X X X X ..... I of the Schedule to the Wealth-tax Act, 1957 ('the Act'). 2. The main contention of the assessee before us is that these properties are not urban assets but are 'business premises' specifically excluded from the levy of additional wealth-tax under the said clause (2). The concerned assets are 5.40 acres of land at Kaloor, one acre of land at Sivarama Menon Road and 56 cents of land near Kasba Station all within the Corporation limits. The aggregate value of these items as determined by the WTO exceeds Rs. 5 lakhs. The Commissioner (Appeals) has found that these three assets owned by the assessee are agricultural land in the sense that the assessee had originally carried on agricultural activities on the land and the trees which were matu ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... does not include any premises in the nature of a guest house ; (ii) 'previous year', in relation to a business or profession, means the period which would be the previous year if an assessment of the profits and gains of such business or profession were to be made under the Income-tax Act for the assessment year ; " 4. Shri Venugopal C. Govind, on behalf of the assessee, contended before us that the Kaloor property of 5.40 acres planted with the coconut trees is agricultural land owned by the assessee in the urban area and used throughout the previous year for purpose of the business of agriculture and the property, therefore, constitutes 'business premises' and is excluded from the category of 'urban asset' for the purpose of the levy ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nal wealth-tax. 5. The departmental representative relying on the orders of the lower authorities pointed out that the urban land owned by the assessee does not constitute 'business premises', agricultural operations on the land do not amount to business activity and in the case of the assessee there had been no systematic or organised course of activity with a set purpose. The assessee had been only carrying on the ordinary acts of husbandry in the land and by such operations the assessee cannot be said to have been using the land for purpose of business. It was also pointed out that the assessee while carrying on the agricultural operations like manuring, turning the top soil, trimming the trees and collecting coconuts had not undertake ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ntation is a business activity. As rightly pointed out for the revenue, the decision of the Punjab and Haryana High Court is distinguishable. 7. The assessee's land in question was notified by the Greater Cochin Development Authority for development and a part of the Kaloor property was compulsorily acquired in 1974. There is no controversy that the assessee, since growing coconut trees in the land before such notification, of late had not undertaken any replantation. It appears that the assessee had carried on the basic agricultural operations and continued to use the land for agricultural purposes during the relevant accounting years. The income derived from the land by agricultural operations on it is agricultural income and not profit ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ition of the term 'business' in section 2(13) being inclusive and not exhaustive is indicative of extension and expansion. The word 'business' is one of large and indefinite import and connotes something which occupies time, attention and labour of a person normally with the object of making profit. It denotes continuous and systematic exercise of an occupation or profession with the object of making, income or profit. The Supreme Court in the case of Narain Swadeshi Wvg. Mills v. CEPT [1954] 26 ITR 765 has observed that the word 'business' connotes some real, substantial and systematic or organised course of activity or conduct with a set purpose. The activity organised on normally accepted commercial lines constitute the essence of any bu ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ies of the agriculturists to derive the income from the land. The income yielded in the hands of the owner is only agricultural income and is not business income. It cannot, therefore, be said that even, if agricultural operations by the assessee are systematic or organised, it would amount to use of the land for the purpose of the business of the assessee. 9. The Punjab and Haryana High Court in Hari Singh's case, in holding that agricultural operations fall within the category of business, has not noticed the implications of sub-rule (ii). The Tribunal in following the said decision has also failed to notice this provision. That judgment must be read as applicable to the particular facts of that case. With respect, therefore, we are una ..... X X X X Extracts X X X X X X X X Extracts X X X X
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