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TMI Blog1991 (8) TMI 147X X X X Extracts X X X X X X X X Extracts X X X X ..... tion from capital gains. According to learned counsel, in view of the decision of J. Raghottamreddy vs. ITO (1988) 68 CTR (AP) 99 : (1989) 169 ITR 174 (AP), capital gains on the sale proceeds of agricultural lands is not exigible to tax. It was further submitted that even after the amendment made in the definition of "agricultural income" with retrospective effect from 1st April, 1970 by the Direct Tax Laws (Amendment) Act, 1989, the ratio laid down in J. Raghottamreddy s case holds good. To support his contention, he relied on a decision of the Tribunal in Kota Venkata Ramachander Rao vs. ITO in ITA No. 389/Hyd/86. 3. (i) Shri V. Sivakumar, learned Departmental Representative submitted before us that the Hon ble Andhra Pradesh High Court ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... In the case of J. Raghottamareddy, profits derived from the sale of agricultural land was construed to be "revenue" derived from such land within the meaning of s. 2(1)(a) of the Act and was treated as "agricultural income". Hon ble High Court has held that Parliament could not have taxed the profits and gains arising from the transfer of a land used for agricultural purposes whether such land is assessed to land revenue in India or is subject to a local rate assessed and calculated by the officer of the government, notwithstanding that such land is situated within the limits of Municipality, etc., with a population of not less than 10,000 or is situated within such distance as may be notified not exceeding 8 km. from such municipal limits ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... purpose of avoiding conflict as to the legislative powers of the States in regard to "agricultural income". (ii) In the case of K.C. Thomas vs. Agrl. ITO (1974) 91 ITR 438, (Ker) the Hon ble High Court negatived the argument on behalf of the petitioner that it is not open to Parliament which enacted Taxation Laws (Amendment) Act, 1970 (Act 42 of 1970)) to define "agricultural income" in such a way as to depart from the definition of that term in which Indian IT Act, 1922 as it stood on 26th Jan., 1950. This was to because there is no express prohibition in the Constitution as to the amendment from time to time of the definition of the term "agricultural income" in the Union Laws relating to Income-tax. It is significant that the words ..... X X X X Extracts X X X X X X X X Extracts X X X X
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